When negotiating your commercial lease in New York, it is important that you know these type of New York leases that may be offered to your New York business. Leases in New York are not take it or leave it. We work with tenants and landlords and negotiations are possible.
The following are the typical leases offered to New York businesses. Other variations are, also, possible.
Lease Types in New York
- Single Net Leases in New York
In a Single Net Lease (Net Lease), the tenant generally pays utilities and property taxes in addition to the base rent. The landlord usually pays for maintenance, repairs and insurance.
- New York Double Net Lease (Net-Net Lease)
The tenant pays for utilities, property taxes and insurance premiums for the building in addition to the base rent. The landlord, usually, pays for maintenance and repairs.
- New York Triple Net Lease (Net-Net-Net Lease)
The tenant is, generally, responsible for all costs of the building in addition to the base rent. The NY landlord is only generally responsible for structural repairs. I have even seen this referred to as a “hell or high water lease” because tenants virtually step into the place of the landlord, including for liability to third party claims.
- New York Full Service Gross/Modified Gross Lease (Modified Net lease)
The landlord and tenant split structural repairs and operating expenses (property taxes, property insurance, common area maintenance (CAM), and utilities).
There are advantages and draw-backs to each kind of lease. For example, Triple Net Leases tend to be more landlord-friendly because it transfers a lot of the landlord’s responsibilities to the tenant, and the lease can also fluctuate from month to month and year to year as operating expenses increase or decrease, making the company’s expense forecasting tricky and sometimes frustrating. On the other hand, tenants benefit from a Triple Net Lease because the tenant can, often, find cost savings in operating expenses and save on their own bottom line.
As you can see, there are many different commercial leases in New York and each contain different and confusing terms and have differing costs and benefits. With any NY lease, New York businesses recognize that the devil’s in the details. Determining which lease in New York suits your needs, your particular business and your finances is a serious consideration for your business.