For information regarding the terms commonly used in the real estate industry, please visit the glossary of terms provided by Real Estate Wiki
Frequently Asked Questions
- What does it mean to accept a suite in "As-Is condition"?
The acceptance by the tenant of the existing condition of the premises at the time the lease is consummated. This would include any physical defects.
- What does "Build To Suit" mean?
An approach taken to lease space by a property owner where a new building is designed and constructed per the tenant's specifications.
- What is a build out?
The space improvements put in place per the tenant's specifications. Takes into consideration the amount of Tenant Finish Allowance provided for in the lease agreement.
- What are "CAM Charges"?
Common Area Maintenance (CAM): This is the amount of additional rent charged to the tenant, in addition to the base rent to maintain the common areas of the property shared by the tenants and from which all tenants benefit. Examples include: snow removal, outdoors lighting, parking lot sweeping, insurances property taxes, etc.
- What is the difference between a "Gross Lease" and a "Triple Net Lease"?
Gross Lease: A lease in which the tenant pays a flat sum for rent out of which the land lord must pay all expenses such as taxes, insurance, maintenance, utilities, etc. Triple Net (NNN) Lease: A lease in which the tenant pays, in addition to the rent, certain costs associated with a leased property, which may include property taxes, insurance premiums, repairs, utilities, and maintenances. There are also net leases, and NN leases, depending upon the degree to which the tenant is responsible for operating costs.
- What is "Base Rent"?
A set amount used as a minimum rent in a lease with provisions for increasing the rent over the term of the lease.
- What does "HVAC" mean?
The acronym for "Heating, Ventilating, and Air Conditioning".
- What is an "Operating Expense Escalation"?
Although there are many variations of operating expense escalation clauses, all are intended to adjust rents by reference to external standards such as published indexes, negotiated wage levels, or expenses related to the ownership and operation of the buildings.
- What is a "Renewal Option"?
A clause giving a tenant the right to extend the term of the lease, usually for a stated period of time and at a rent amount provided for in the option language.
- What are "Tenant Improvements"?
Improvements made to the leased premises by or for a tenant. Generally, especially, in new space, part of the negations will include in some detail the improvements to be made in the leases premises by the landlord.
- What does the term "Usable Square Footage" mean?
Usable Square Footage is the area contained within the demising walls of the tenant space. Total Usable Square Footage equals the Net Square Footage × the circulation factor.