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A triple net lease is a lease agreement between a commercial property owner or manager and a tenant. This type of lease is commonly used for retail, industrial, and free-standing buildings. The term "triple net" refers to three key expenses the tenant is responsible for: property insurance, real estate taxes, and common area maintenance. These costs are typically estimated annually and incorporated into the monthly rent. At the end of the year, if actual costs are lower than estimated, the tenant receives a refund; if higher, the tenant owes the difference. Tenants often request a cap on the triple net amount to limit potential increases.
