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A commercial real estate lease in which the tenant regularly pays not only for the space (as he does with a gross lease) but for a portion of the landlords operating costs as well. when all three of the usual costs–taxes, maintenance, and insurance–are passed on, the arrangement is known as a “triple net lease.” because these costs are variable and almost never decrease, a net lease favors the landlord. accordingly, it may be possible for a tenant to bargain for a net lease with caps or ceilings, which limit the amount of rent the tenant must pay. for example, a net lease with caps may specify that an increase in taxes beyond a certain point (or any new taxes) will be paid by the landlord. the same kind of protection can be designed to cover increased insurance premiums and maintenance expenses.

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