Which type of lease involves payments for operating expenses, property taxes, and insurance?

A triple-net lease is characterized by the lessee's obligation to cover not only the base rent but also additional expenses related to the property. These expenses typically include operating costs, property taxes, and insurance premiums. This lease structure is popular in commercial real estate because it allows property owners to pass on the financial responsibilities associated with property management to tenants, thereby reducing their own exposure to fluctuating costs.

In a triple-net lease arrangement, tenants have greater control over the operational aspects of the property since they are aware of and manage these expenses directly. This transparency can lead to various financial advantages for both landlords and tenants, including clearer budgeting and predictability in financial planning. The arrangement can also enhance the value of the property, as it offloads responsibilities and liabilities onto the tenant.

Other lease types, such as single-net and double-net leases, involve varying levels of tenant responsibility for expenses, but do not encompass the full range of operating expenses, property taxes, and insurance in the same comprehensive manner as a triple-net lease. A graduated rental lease, on the other hand, focuses primarily on the rental payment structure and does not specifically address the allocation of operating expenses or property-related costs.