Hey everyone! Jason Rogers here with Craig Byers. We are with Q4 Commercial Real Estate and today on our informational video we are going to talk about Triple Net leases (NNN), what they are, the basics of them and what is included in the CAM or Common Area Maintenance.
(Jason) So Triple Net leases, there is a few different varieties of Triple Net leases and we are not going to get into that, but what we are going to talk about is what does this mean.
(Jason) What are the three N’s?
- One and typically the most expensive is property taxes. That is one N or a Net.
- Another Net is insurance which is pass through and we will get to that in a second.
- The final N is CAM or common Area Maintenance.
(Jason) Now Triple Net leases are sometimes referred to as pass throughs or additional rent or operating expenses. So you will see that phraseology when you are looking at NNN leases.
(Jason) A very common question that we get is what is included in that one Net which is Common Area Maintenance or CAM? What is all included in that CAM?
(Craig) Yeah and these line items can kind of vary from lease to lease or landlord to landlord. But your more typical CAM expenses are going to be snow and ice removal, landscaping, how many times it is mowed and weeds are pulled stuff like that. If it is small maintenance expenses that might be concrete repair, curb and gutter repairs, obviously janitorial expenses within the common areas to make sure they are kept clean and neat, utilities so common area restrooms, water, gas needed to heat and cool it, electricity. So really common area maintenance think of the expenses the landlord incurs to keep all common areas maintained and looking nice and tidy.
(Craig) Things that you should not include or that are not typically found in CAM would be large capital expenditures such as total roof replacement, brand new parking lots being poured, those are expenses that would typically be incurred 100% by the landlord and not passed through to the tenants.
(Jason) Ok perfect so again Triple Net leases (NNN) leases, property taxes, insurance, and CAM or common area maintenance. I think we covered everything.
We appreciate you guys tuning in. Thank you very much!
You can watch the informational video, Realtor Talk The Triple Net (NNN) Lease with Craig and Jason below.
For more information on the NNN lease, check out our blog post titled: An NNN Lease Versus a Gross Lease: What’s the difference?
Let one of our knowledgeable listing agents partner with you to find a commercial real estate property perfect for your business needs, and assist you in working through the lease process. Contact Jason Rogers or Craig Byers today!