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A triple net lease is an agreement between a commercial property owner/manager and a tenant where the tenant is responsible for property insurance, real estate taxes, and common area maintenance. The costs for these expenses are usually estimated for the year and included in the rent on a monthly basis. At the end of the year, if the costs were lower, the tenant receives a refund, but if higher, they owe the difference. Most tenants request a cap on the triple net amount to limit potential unexpected costs. Triple net leases are commonly used for retail, industrial, and free-standing buildings.
