Triple Net (NNN) vs. Gross Leases: Which Is Better for Business?

 Posted on July 21, 2025 in Commercial Lease Agreements

Choosing the right type of commercial lease is one of the most important decisions a business owner will make, especially when the business is first beginning. Throughout DuPage County, commercial property agreements generally fall into two categories: triple net (NNN) leases and gross leases. 

Each structure has its advantages and potential drawbacks, and understanding the differences is crucial before signing a lease that could affect your bottom line for years to come. At Lindell & Tessitore, P.C., our Naperville, IL commercial real estate attorneys can help you choose the right commercial lease, negotiate favorable terms, and manage any other issues that come up in the course of doing business. 

What Is a Triple Net (NNN) Lease?

In a triple net lease, the tenant pays the base rent to the landlord but also assumes responsibility for three major expense categories:

• Property taxes

• Insurance premiums

• Maintenance and repair costs

This arrangement allows landlords to pass most of the property’s operating costs on to tenants. For business owners, NNN leases typically offer lower base rent payments but can create unpredictable monthly expenses as taxes, insurance, or maintenance costs fluctuate.

Many investors and landlords prefer NNN leases for multi-tenant buildings or stand-alone commercial spaces because they reduce the landlord’s financial risk and administrative burden.

What Is a Gross Lease?

A gross lease simplifies things for tenants by rolling all expenses into one fixed monthly payment. The landlord collects a higher base rent but remains responsible for paying property taxes, insurance, and maintenance.

This lease structure offers predictability, which can be helpful for businesses with tight budgets or startups managing cash flow. Tenants are not directly exposed to rising property tax rates or unexpected repair bills, making gross leases attractive for office spaces and certain retail settings.

Which Lease Structure Is Better for Your Business?

The right lease depends on your business goals, financial stability, and risk tolerance.

• Consider a triple net lease if you want a lower base rent and are comfortable managing variable property costs. Businesses in industrial, medical, or single-tenant retail spaces often prefer this model because it provides more control over property expenses.

• Consider a gross lease if you prefer predictable expenses and do not want to deal with property management. This option can make budgeting simpler, especially for small businesses and professional offices.

It is also important to note that landlords often negotiate "modified gross leases," which blend elements of both structures to meet the needs of both parties.

Protecting Your Interests in a Commercial Lease

Whether you are considering a triple net or gross lease, the fine print of your agreement will define your legal and financial obligations. Lease terms covering common area maintenance charges, repair responsibilities, and tax escalation clauses can dramatically alter your cost of occupancy.

Working with an experienced commercial real estate attorney ensures you fully understand your lease and can negotiate terms that protect your business. Legal guidance is especially important in DuPage County’s competitive market, where landlords often draft lease agreements that prioritize their interests.

Contact a DuPage County, IL Commercial Real Estate Lawyer

Before signing a lease for your business, speak with a Naperville, IL commercial lease negotiation attorney at Lindell & Tessitore, P.C.. We can review your lease, explain the long-term implications of the various terms, and help you negotiate. Call 630-778-3818 to schedule a consultation and get your business started on the right foot.