In a Net-Net-Net (Triple Net) Lease, what does the tenant assume responsibility for?

In a Net-Net-Net (Triple Net) Lease, the tenant assumes a high level of responsibility regarding the property, primarily covering real estate taxes, insurance, and non-structural maintenance costs. This arrangement shifts the financial burden of these critical operational expenses from the landlord to the tenant, making it a preferred lease structure for landlords seeking predictable income without the variability of managing these costs.

The inclusion of real estate taxes means that tenants must pay for the property taxes assessed by local governments, further committing them to the ongoing costs associated with property ownership. Insurance coverage is also the tenant's responsibility, requiring them to take out policies to protect against potential liabilities related to the property and its usage. Non-structural maintenance encompasses upkeep that isn’t related to the building’s fundamental framework, which can include things like landscaping, parking lot maintenance, and minor repairs.

Understanding this structure is essential for anyone involved in property management or leasing agreements, as it delineates the financial responsibilities clearly, allowing tenants to budget appropriately while landlords benefit from reduced management obligations and diminished financial risk.