Gross Lease (Full-Service Lease)

What it means

Pure gross leases are most common in residential and some older office product. The tenant pays one number; the landlord handles taxes, insurance, utilities, maintenance, and capex.

Gross leases are straightforward but expose the landlord to all expense inflation. Higher-base-rent gross leases often look cheap on NOI when expenses spike. Most commercial landlords now prefer modified gross or NNN structures that pass some or all of the expense volatility to tenants.