Free Tool: Modeler
NNN vs Gross Lease Comparison
A gross lease quotes a single flat rent while a triple-net (NNN) lease adds taxes, insurance, and CAM on top. Comparing the true all-in cost is the first step to understanding whether you are paying too much, and where the overcharges are hiding.
NNN vs Gross lease: In a triple-net (NNN) lease, you pay base rent plus your pro-rata share of taxes, insurance, and CAM. In a gross lease, the landlord pays all operating expenses from a flat rent. Gross leases have less CAM audit risk, but NNN leases can be cheaper when operating expenses are efficiently managed.
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Annual Cost Comparison
Enter your details above to compare lease structures.
Frequently Asked Questions
What is the difference between an NNN lease and a gross lease?
In a gross lease, you pay a single flat rent that covers base rent plus the landlord's operating expenses. In a triple-net (NNN) lease, you pay base rent plus your pro-rata share of property taxes, insurance, and CAM separately. The all-in cost of an NNN lease is often higher than the quoted base rent suggests.
How do I calculate my true annual cost under an NNN lease?
Multiply your leased square footage by your pro-rata share of annual taxes, insurance, and CAM, then add that to your annual base rent. Landlords often present NNN charges as a per-square-foot figure; multiply by your square footage to get the actual annual dollar impact.
Can a gross lease tenant be charged CAM?
In a true gross lease, CAM charges are already included in the base rent. Any attempt to bill CAM separately on top of a gross rent is an overcharge. If your lease is a modified gross lease, the specific inclusions and exclusions are defined by your lease language and must be reviewed carefully.
What expenses are typically included in NNN charges?
Standard NNN charges include real property taxes, property insurance, and common area maintenance (CAM). Some leases also include utilities, management fees, or capital expense reserves in the NNN pass-through. Your lease defines the exact pass-through scope.
Is an NNN lease always more expensive than a gross lease?
Not necessarily. A gross lease with a higher base rent can cost more than an NNN lease with low operating expenses. The comparison depends on actual tax, insurance, and CAM amounts in the building. This tool calculates the all-in cost under both structures so you can compare directly.