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Commercial Tenants' Audit Rights
Net leases require tenants to pay a portion of the building-wide maintenance and common area upkeep, as well as the property insurance and tax bills. While you want to trust your landlord to allocate the costs as agreed to in the lease, you’ll also want a way to check his figures. You want audit rights.
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Exercising Your Commercial Lease Audit Rights
Audit rights let you look at the landlord’s books, to determine whether maintenance costs have been allocated properly. Here are the details on how to exercise your inspection rights.
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With a gross lease for commercial space, the renter pays the landlord a fixed monthly rent. It is then up to the landlord to pay the expenses of operating the building.
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Commercial Net Lease for Entire Building
In a net lease, the tenant not only pays rent, but also part of the building's operating costs. These costs include property taxes, insurance and maintenance -- a lease that requires the tenant to pay for all three of these costs is known as a triple net" lease."
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Commercial Net Lease for Part of Building
In a net lease, the tenant not only pays rent, but also part of the building's operating costs. These costs can include property taxes, insurance and maintenance.