Glossary
Lease Types
Double Net Lease (NN)
A net lease where the tenant pays real estate taxes and insurance on top of base rent, but the landlord keeps responsibility for CAM and maintenance costs. Reading an NN lease as a full NNN lease pulls maintenance costs into audit scope the lease never authorized.
Firm impact
Scoping a double net lease as if it were triple net wastes engagement time chasing maintenance-cost findings the tenant was never responsible for. Getting the classification right up front keeps the audit focused on the categories that actually matter.
How this gets abused
A landlord bills a tenant under a double net lease for landscaping, janitorial, and common-area repairs, all costs the lease reserves as the landlord's own responsibility since only taxes and insurance pass through. The tenant paid these charges for three years before anyone checked the lease's actual net structure.
Practitioner note
Confirm early in intake whether a lease is genuinely double net or triple net. If maintenance and CAM charges show up on a reconciliation for a lease that only authorizes tax and insurance pass-throughs, that's the finding, not a category to audit line by line.
Related terms
FAQ
Questions about double net lease (nn)
Does a tenant under a double net lease pay any CAM charges?
Not under the classic NN structure. The landlord retains responsibility for CAM and maintenance; the tenant's obligation is limited to taxes and insurance passed through on top of base rent.
What should a firm do if CAM charges appear on a double net lease reconciliation?
Check the lease's actual pass-through clause first. If it doesn't authorize CAM or maintenance charges, those line items are an overcharge regardless of what the reconciliation statement calls them.
You know the term. Now check the math.
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