Property Management Flashcards

In a triple-net (NNN) lease, the tenant is responsible for:

Answer: Base rent plus property taxes, insurance, and maintenance

A triple-net lease requires the tenant to pay base rent plus the three 'nets': property taxes, building insurance, and maintenance/repairs.

A percentage lease requires the tenant to pay:

Answer: Base rent plus a percentage of gross sales above a breakpoint

Percentage leases are common in retail settings; the tenant pays a minimum base rent plus a percentage of gross sales that exceed a specified natural breakpoint.

CAM (Common Area Maintenance) charges in a commercial lease are used to cover:

Answer: Shared costs for lobbies, parking lots, landscaping, and hallways

CAM charges allocate each tenant's proportionate share of maintaining shared spaces in multi-tenant properties such as shopping centers and office buildings.

An estoppel certificate in commercial real estate is a document signed by a tenant that:

Answer: Certifies the current lease terms and status as accurate

An estoppel certificate is a binding statement confirming lease terms, payment status, and any disputes, commonly required by lenders or buyers during due diligence.

Constructive eviction occurs when a landlord:

Answer: Fails to maintain the property to a habitable standard, effectively forcing the tenant to leave

Constructive eviction happens when a landlord's failure to maintain habitable conditions makes the premises unfit, allowing the tenant to vacate and terminate the lease.

A holdover tenant who remains after the lease expires without permission becomes a:

Answer: Tenant at sufferance until the landlord acts

A holdover tenant becomes a tenant at sufferance — they have no landlord permission to remain and may be treated as a trespasser or converted to a periodic tenancy at the landlord's option.