Leasing Information

If you plan to lease, then complete the Leasing Costs worksheet. Remember that when you rent a work-only or live/work space, you must carefully review the draft lease to determine whether the price is for a gross lease or a net lease.

• Gross Lease: Under a gross lease, you pay a monthly fixed rent to the landlord, who then pays all operating expenses such as real estate taxes, insurance, repair costs and common area maintenance costs (CAM). Common areas include lobbies, shared bathrooms, and elevators. Some landlords cover utilities, but many do not. (Most residential leases are gross leases, while commercial and industrials leases can be either a gross or net lease.)

• Net Lease: Under a net lease, you pay rent plus a portion of the operating expenses -- which might include CAM, insurance costs and real estate taxes. These are sometimes described as a square-foot price. For example, your rent quote might state that $1.25 of the rent covers the CAM costs, which may or may not be included your portion of the property taxes. Both a double net lease (a.k.a. net-net) and triple net lease (a.k.a. net-net-net) are forms of a net lease.

Taxes and utilities can add up to hundreds or even thousands of dollars to your monthly rent, making that "cheap" space too much for your budget. If the lease is unclear, ask the landlord if additional charges will be levied; write his/her response into the lease in clear language before you sign. If you are working with a real estate agent, ensure that he/she helps you to identify any additional costs associated with the space.

If you have difficulty determining these costs, Chapters 17-22 provide the necessary information, resources and questions to ask when assessing a space. Once you have gathered all of the cost information, complete the worksheet.

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Chpt.2_ LeasingCosts.pdf	43.53 KB