Listen to a Business English Dialogue about Triple net lease
Jerry: Hi Ashley, have you ever heard of a triple net lease?
Ashley: No, what is it?
Jerry: A triple net lease is a type of lease agreement where the tenant is responsible for paying not only the rent but also the property taxes, insurance, and maintenance costs associated with the property.
Ashley: Oh, so the tenant bears all the additional expenses on top of the rent?
Jerry: Exactly. Triple net leases are common in commercial real estate and offer benefits for both landlords and tenants.
Ashley: That makes sense. So, what are some advantages of a triple net lease for landlords?
Jerry: Landlords benefit from a predictable rental income stream and reduced operating expenses since the tenants are responsible for maintenance and other costs.
Ashley: I see. Are there any risks for tenants with a triple net lease?
Jerry: One risk is that tenants may face unexpected expenses if property taxes or insurance costs increase unexpectedly.
Ashley: That sounds challenging. So, how do tenants typically negotiate a triple net lease?
Jerry: Tenants can negotiate terms such as caps on operating expenses or provisions for the landlord to cover certain major repairs.
Ashley: Thanks for explaining, Jerry. Triple net leases seem like a complex but potentially beneficial arrangement for both parties.
Jerry: No problem, Ashley. They’re a common structure in commercial real estate that offers advantages for landlords and tenants alike.