The lease agreement system which makes the tenant to pay all the expenditure of a structure, including tax, money required for the maintenance of the structure and common area maintenance, etc.,. The responsibilities of the landlord is very less with compare to other type of rent system because the full responsible of the structure is on the head of the tenant.In common, Triple net lease system is commonly used for the commercial buildings but for the residential buildings double net lease is used.
Disadvantages of Triple Net Lease
RISK factors of Triple Net Lease: Irresponsibility of the tenant may take place in the maintenance of that particular building. Reserve fund method is a way which is used to overcome above risk. Sudden increase in the tax amount will not affect the landlord because the tenant has those responsibilities. More amounts of income with less input from landlord’s side.
Advantages of Triple Net Lease to Tenants
Advantage for the
tenant is he/she can invest the more money in other business or equity. Tenants can be peaceful and get more money than the actual rent that he/she has to pay to the landlord that is the positive income for the tenant.
How to Overcome Triple Net Lease Problems
To Overcome the problems of a triple net lease system. The agreement should prepare by the experienced person. Both tenant and landlord must evaluate the plus and minus of their side. The landlord should choose the tenant carefully by knowing his business and impact of that in the property.