A commercial tenant in BC signs a gross lease. What does this mean regarding operating costs?
Correct Answer
B) The landlord includes operating costs in the base rent, so the tenant pays a single all-inclusive rental amount
In a gross lease, the landlord bundles operating costs (property taxes, insurance, maintenance) into the base rent, and the tenant pays a single rental amount. This contrasts with a net lease where the tenant pays base rent plus operating costs separately. Gross leases are less common in BC commercial markets but may include escalation clauses or expense stops.
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