What is a triple net lease?

A triple net lease, often written as **NNN** , is a commercial lease where the tenant pays the **base rent** plus three major property costs: **property taxes, insurance, and maintenance/common-area expenses**. In practice, that means the landlord’s income is more predictable, while the tenant takes on more of the building’s ongoing costs.

Quick Scoop

• Tenant pays: rent, taxes, insurance, and maintenance/CAM costs.

• Landlord gets: simpler, steadier cash flow because many variable expenses are shifted to the tenant.

• Common in: commercial real estate, especially long-term leases.

How it works

The lease usually starts with a lower base rent than a gross lease, because the tenant is also covering operating expenses. Those extra costs are often estimated during the year and then reconciled against actual expenses later.

Why it matters

For landlords, triple net leases can reduce management burden and stabilize returns. For tenants, the tradeoff is lower base rent but more exposure to rising taxes, insurance premiums, and repair costs.

Simple example

If a business leases a retail building under an NNN agreement, it might pay monthly rent to the owner and separately reimburse its share of the property tax bill, insurance premium, and upkeep costs for the property.

Lease type	Who usually pays property taxes?	Who usually pays insurance?	Who usually pays maintenance/CAM?
Gross lease	Landlord	Landlord	Landlord
Triple net lease	Tenant	Tenant	Tenant

If you want, I can also explain the difference between **single net, double net, triple net, and gross leases** in one easy table.