The triple net (NNN) commercial lease agreement is a real estate contract for non-residential property between landlords and a business tenant. The term triple-net refers to the landlord covering most of the expenses on the property, and that the monthly rent includes all fees related to property taxes, insurance, and common area maintenance (CAM’s) on the property. The tenant is only responsible for the utility and services on the property such as electricity, water, internet, etc.
This type of lease usually longer term than a residential lease, and therefore is recommended that the parties sign the agreement in the presence of a notary public.
How to Write
All details about the property should be gathered before writing the contract in addition to performing a background check and/or financial lookups. If the business is new and/or does not have assets it is highly advised the landlord seek a peronal guaranty.
Step 1 – Enter the:
- date of the agreement;
- lessor’s information;
- lessee’s information;
- and the property information.
Step 2 – In the next sections, 2 & 3, write the:
- the use of the property;
- the term of the contract including any renewal periods, how long they will be and how many days’ notice the tenant must provide before activating.
Step 3 – In sections 4 & 5 the rental amount must be stated and the security deposits in the following form:
- total amount during initial period;
- monthly amount during initial period;
- if rent is to increase at any point in time during the initial term write when and by how much it increases;
- if rent is to increase during the renewal period(s), as a percent or fixed dollar amount, it should be stated;
- the fees at the commencement of the lease are now to be disclosed being the first (1st) month’s rent, last month’s rent, and the security deposit (if any);
- include in the section below the late fee for paying rent late in the State;
- in Section 5 enter the security deposit (if any) that the tenant is going to be paying.
Step 4 – In Section 6 enter the date the tenant will take possession of the premises.
Step 5 – In Section 10, if the landlord requires any type of liability insurance or if the tenant would like it for themselves they can fill-in their minimum requirements.
Step 6 – In Section 11, if the tenant is part of a multi-tenant complex their percentage of the total square footage (SF) should be listed if there are future project costs that the tenant are to finance.
Step 7 – In Section 16, the parties are to negotiate how many days is suitable for the landlord to place a ‘For Rent’ sign on display before the expiration of the lease.
Step 8 – If there are to be official notices sent by any of the parties the legal address should be listed in Section 25.
Step 9 – If there are any attachments they should be listed in Section 33.
Step 10 – All parties should sign the document, as stated previously, should be done with a notary public present for legal verification.