Practice Test Geeks(CRECI) Commercial Real Estate Certification Institute Practice Test
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Commercial Lease Analysis Flashcards

7 cards from real CRECI practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Commercial Lease Analysis flashcards as text

  1. In a percentage lease, what does the 'breakpoint' refer to?

    Answer: The sales volume at which percentage rent kicks in

    The breakpoint is the sales threshold above which the tenant pays additional percentage rent on top of base rent.

  2. Which lease clause grants a tenant the right to match any competing offer before the landlord accepts it from a third party?

    Answer: Right of first refusal

    A right of first refusal allows the tenant to match a third-party offer and acquire the space or property on the same terms.

  3. A 'gross-up' provision in a commercial lease typically benefits the landlord by:

    Answer: Adjusting operating expenses to reflect full building occupancy

    Gross-up provisions normalize operating expense calculations as if the building were 95-100% occupied, preventing low-occupancy years from understating tenant expense obligations.

  4. Under a triple-net (NNN) lease, which of the following costs is typically the LANDLORD'S responsibility?

    Answer: Structural repairs to the roof and foundation

    In most NNN leases, structural elements such as the roof and foundation remain the landlord's responsibility while the tenant covers taxes, insurance, and maintenance.

  5. What is the purpose of an 'estoppel certificate' in commercial real estate?

    Answer: To confirm the current status and terms of a lease for a third party

    An estoppel certificate is a signed statement by the tenant confirming the lease terms, rent status, and any defaults, typically required during property sales or refinancing.

  6. A 'holdover' clause in a commercial lease addresses what situation?

    Answer: A tenant who remains in possession after the lease expires

    A holdover clause specifies the terms — often at 150-200% of the prior rent — under which a tenant may remain after the lease term ends without a new agreement.

  7. Which type of rent escalation ties annual increases to changes in the Consumer Price Index?

    Answer: Index-based escalation

    Index-based escalation links rent increases to a published inflation measure such as the CPI, protecting the landlord's purchasing power over the lease term.