In a triple net lease arrangement, which of the following expenses is typically paid by the tenant?
Correct Answer
A) Property taxes, insurance, and maintenance costs
In a triple net lease (NNN), the tenant pays all three major property expenses: property taxes, insurance, and maintenance costs, in addition to the base rent. This shifts most property operating expenses from the landlord to the tenant.
Why This Is the Correct Answer
Option A correctly identifies all three components of a triple net lease arrangement. In NNN leases, tenants pay property taxes, insurance premiums, and maintenance costs in addition to base rent. This comprehensive expense responsibility is what defines a 'triple' net lease, distinguishing it from other net lease structures. The arrangement transfers virtually all property operating expenses from landlord to tenant, creating a pass-through structure where the tenant assumes responsibility for the property's operational costs beyond the base rental payment.
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