The Naming Game
Also important to note is that real estate brokers commonly refer to annual square footage rates while tenants frequently prefer to look at rates on a monthly basis. This difference may occur because each uses the rate differently. Tenants commonly look at their expenses from monthly expense perspective, while agents deal in leasing agreements in annual terms. Aside from different rental rate terms, there are key attributes associated with each square footage rate.
These attributes are most commonly referred to as: Full Service Gross, Industrial Gross (or Single Net), Double Net and Triple Net (or Absolute Net); all of these except the Full Service Gross rent may have Common Area Maintenance (CAM) charges added on. On property fact sheets you may see these written as; FSG, IG, N, NN, NNN, CAM. These traits determine who pays the utilities, janitorial and other building services (elevators, common hall lights, etc.) and are key factors in determining the true asking rate. Note: Retail tenants may also be subject to a percentage rent that requires the tenant to pay a percentage of the gross sales. Typically this kicks in after the yield of the percentage of gross sales exceeds a certain minimum rent.
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