6 Lease Types

Commercial Lease Types Explained

From NNN to Full Service Gross to Ground Leases — understand every commercial lease structure, who pays what, and the critical fields and red flags to watch before you sign or acquire.

Triple Net Lease (NNN)

NNN

Triple net (NNN) leases: tenant pays base rent, property taxes, insurance, and maintenance. Learn NNN expenses, red flags, and the 126 fields to abstract.

RetailFast Food / QSRPharmacy

Typical term: 10–25 years

Modified Gross Lease

MG

Modified gross leases split operating expenses between tenant and landlord. Learn expense allocation, base year provisions, and red flags to watch.

OfficeFlex SpaceMedical Office

Typical term: 3–7 years

Ground Lease

GL

Ground leases: tenant leases land, builds improvements, and loses them at expiration. Learn 50-99 year terms, leasehold financing, and red flags.

Retail PadsHotelsOffice Buildings

Typical term: 50–99 years

Percentage Lease

PCT

Percentage leases combine base rent and a cut of gross sales. Learn breakpoints, natural vs artificial, gross sales definitions, and red flags.

Regional MallsOutlet CentersStrip Centers

Typical term: 5–15 years

Gross Lease

GRS

Gross leases: tenant pays one fixed rent, landlord covers all expenses. Learn differences from full service gross, NNN, and key lease terms.

Older Office BuildingsSmall Commercial SpacesIndustrial (older stock)

Typical term: 1–5 years

Build-to-Suit Lease

BTS

Build-to-suit leases: developer builds to tenant spec, tenant commits for 15-25 years. Learn BTS structure, NNN operation, and critical abstractions.

Corporate HeadquartersDistribution / Fulfillment CentersManufacturing

Typical term: 15–25 years

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Frequently Asked Questions

What types of commercial leases does Lextract support?
Lextract supports all 11 major commercial lease types: Triple Net (NNN), Modified Gross, Full Service Gross, Gross, Double Net (NN), Absolute Net, Percentage Lease, Ground Lease, Net Lease, Industrial Gross, and Build-to-Suit. The extraction schema's 126 fields are calibrated to capture the relevant financial and operational provisions for each structure.
What is the difference between a gross lease and a net lease?
In a gross lease, the tenant pays a single all-inclusive rent and the landlord covers most operating expenses — taxes, insurance, and maintenance. In a net lease, the tenant pays a lower base rent but separately reimburses the landlord for some or all operating expenses. The key distinction is which party bears the risk of rising operating costs, which makes the CAM and expense pass-through fields in Lextract's extraction especially important for net leases.
Can Lextract abstract a modified gross lease?
Yes. Modified gross leases — which split expense responsibility between landlord and tenant in negotiated ways — are fully supported. Lextract extracts the base rent, the specific expense categories each party is responsible for, any operating expense stops or base years, and CAM cap provisions. Confidence scoring flags any provisions where the expense allocation language is ambiguous.
What makes NNN lease abstraction different from gross lease abstraction?
NNN lease abstraction requires extracting three separate expense obligation fields — property taxes, building insurance, and CAM — plus any caps, exclusions, or audit rights that limit tenant exposure. Gross lease abstraction focuses more on the all-in rent and any specific carve-outs the tenant is responsible for. Lextract's 18 CAM-relevant fields are especially important for NNN abstractions where expense exposure can add 30–50% to the base rent.
Does lease type affect extraction accuracy?
Lease type does not significantly affect overall extraction accuracy, but it does affect which fields are populated. NNN and modified gross leases populate more CAM and expense fields than full service gross leases. Complex structures like ground leases and percentage leases may generate more medium-confidence fields due to their less standardized language. Lextract's confidence scoring identifies any fields that warrant additional human review regardless of lease type.

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