June 2014 Tips
Is Percentage Rent Being Phased Out ?
It depends on the clout of the tenant.
If the tenant has a lot of clout, such as a supermarket or a department store, it can take the position that it is not prepared to pay any percentage rent.
In some leases, such as an office lease, or a bank or financial institution, percentage rent is not normally payable.
How Do You Distinguish Between "Net", "Net Net" and "Net Net Net" ?
My understanding is that there is no difference between the 3 terms, as the word "net" implies that the tenant is responsible for the taxes, maintenance and insurance on its premises.
How Do You Properly Evaluate Proportionate Share ?
A pure "pro rata" share of what the tenant pays towards the landlord's "operating costs", is based on a fraction, namely: a numerator of the rentable area of the premises, and a denominator of the rentable area of the development.
Many leases modify this fraction.
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