Commercial Real Estate
Who Really Pays the Expenses in Commercial Real Estate?
BANKCASA Editorial · 2026-11-01 · 5 min
In commercial real estate, the rent is only part of the story. The lease decides who pays the building's expenses — and that decision shapes the real return of an investment. What a Triple Net Lease means In a Triple Net Lease, known as NNN, the tenant pays a base rent plus three additional categories: property taxes, building insurance and maintenance costs, often called CAM or common area maintenance. The three "nets" move much of the property's operating expenses from the owner to the tenant. How it compares to other leases In a gross lease, the owner covers operating expenses out of a higher rent. A modified gross lease splits expenses between both parties. The NNN structure sits at the other end: the tenant assumes most variable costs, and the owner's income becomes more predictable. Why investors pay attention Predictability is the attraction. When taxes, insurance and maintenance pass through to the tenant, the owner's net income is easier to project. But predictable is not guaranteed: the strength of the tenant, the length of the lease and the exact wording of each clause decide how the agreement performs in practice. What to review before signing Every NNN lease is different. Before committing, review which expenses are included, how they are calculated and reconciled, whether there are caps or escalation clauses, and who is responsible for major items such as the roof and the structure. These details define who really pays. The bottom line Understanding lease structures is part of understanding the investment itself. This article is educational content, not financial or legal advice; every property and every contract deserves its own professional review.