Full Definition
A triple net (NNN) lease is a commercial lease structure where the tenant pays all three major operating expenses — property taxes, building insurance, and maintenance — in addition to base rent. The landlord collects a predictable rent check with minimal operational involvement. This is the most passive commercial real estate structure.
Example
A tenant signs a $100K/year NNN lease. They also pay the property's $15K in taxes, $5K in insurance, and all maintenance costs. The landlord's income is $100K regardless of expense volatility.
Why It Matters
NNN leases are the foundation of single-tenant investment real estate. They enable truly passive income and are highly sought by 1031 buyers.
Related Terms
Absolute NNN Lease
The purest form of NNN lease — tenant is responsible for everything including roof and structure.
Double Net Lease (NN)
Lease where tenant pays taxes and insurance but landlord remains responsible for structural items like roof and HVAC replacement.
Full-Service Lease (Gross Lease)
Lease where the landlord pays all operating expenses (taxes, insurance, maintenance, utilities). Common in office buildings.
Ground Lease
Long-term lease of land only — tenant owns building improvements on land owned by the lessor.