Gross lease

A gross lease is a type of commercial lease where the tenant pays a flat rental amount, and the landlord pays for all operating expenses regularly incurred by the ownership, including taxes, electricity and water.[1] Most apartment leases resemble gross leases.[2] The term "gross lease" is distinguished from the term "net lease".

Types of gross leases

Modified Gross (MG)

In a modified gross lease, tenants typically pay a proportional share of operating expenses.[3]

Full-Service Gross (FSG)

In a full service gross lease, outgoings (operating expenses) are paid by the landlord, but are imputed into the price of the lease.[4]

References
  1. Helewitz, Jeffrey A. (2015). Basic Real Estate and Property Law for Paralegals (5th ed.). New York: Wolters Kluwer. p. 203. ISBN 978-1-4548-5122-6.
  2. H. Kent Baker; Peter Chinloy (7 August 2014). Private Real Estate Markets and Investments. Oxford University Press. p. 97. ISBN 978-0-19-938877-6.
  3. Chen, James. "Understanding Modified Gross Leases". Investopedia. Retrieved 2021-03-03.
  4. Mastroeni, Tara. "What is a Full-Service Gross Lease? Landlord Guide". Millionacres. Retrieved 2021-03-03.
  • Principles and Practices of New Jersey Real Estate 6th Ed by Frank W. Kovats, DREI.


See also: Net lease
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