Which party generally assumes risk and responsibility in a triple net lease?

In a triple net lease, the tenant assumes a significant portion of the financial responsibility and risk associated with the property. This type of lease structure places the obligation of covering property expenses directly onto the tenant. Specifically, the tenant is typically responsible for the costs associated with property taxes, insurance, and maintenance, in addition to paying rent.

This approach is beneficial for landlords because it reduces their financial exposure, as they are not burdened with these additional costs. As a result, landlords often prefer triple net leases for commercial properties, knowing that the tenant will handle the operating expenses. The structure fosters a clear delineation of financial responsibilities, making it an efficient option for both parties. Understanding this arrangement is essential for anyone involved in real estate transactions, particularly in lease negotiations and property management.