Tennessee Real Estate License Exam Practice Question
A tenant has a commercial lease that requires that the tenant pay taxes, insurance, maintenance, and parking lot repairs. What kind of lease does the tenant have?
Correct Answer: A
Rationale: A net lease requires the tenant to cover additional expenses beyond the base rent, such as taxes, insurance, maintenance, and repairs, which aligns with the scenario described.
In contrast, a gross lease includes these costs within the rent, making option B incorrect. A ground lease typically involves leasing land for long-term development, which does not apply here, thus ruling out option C. Lastly, a percentage lease is based on a tenant's sales revenue, not on additional expenses, making option D unsuitable. Therefore, the net lease accurately reflects the tenant's obligations.
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