A shopping-center tenant pays monthly base rent and additional rent equal to a percentage of retail sales above a break point. What type of lease is this?
Correct Answer
B) Percentage lease
Percentage lease is correct because the facts match a lease in which the tenant pays base rent plus a percentage of gross sales above the threshold stated in the lease. That is the best description of the relationship, right, or legal concept tested here.
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Related Concepts
In a cooperative (co-op), the building is owned by a corporation, and residents purchase shares of stock in the corporation that entitle them to a proprietary lease on a specific unit. Residents are shareholders, not property owners.
Fee simple absolute is the highest and most complete form of property ownership, giving the owner unrestricted rights to use, possess, enjoy, and dispose of the property. It is of unlimited duration and fully inheritable.
Community property is a system where property acquired during a marriage is owned equally by both spouses.
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A retail tenant pays base rent and is also responsible for taxes, insurance, and common-area maintenance charges. What type of lease is this?
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An investor leases a vacant parcel for 50 years in order to construct an office building on the site. What type of lease is this?