10. Glossary of Lease Terms
June 9, 2010 Leave a Comment
- Class A Office Space
- Newer properties (built since 1980) of 100,000 square feet or larger in prime business districts. These buildings usually have at least five floors and are constructed of steel and concrete. They offer many business amenities and good access.
- Class B Office Space
- These properties are typically smaller, older and of wooden framed construction. They have usually been renovated and are in good locations. If the buildings are newer then they are typically smaller and not in a prime location.
- Class C Office Space
- Class C properties are older and have not been renovated. Their condition is typically fair but not considered good.
- Escalation Clause
- A clause that allows for increases in rent over time usually determined by an outside source such as the consumer price index.
- Fixed Lease
- A lease that does not include increases, but rather has a flat fixed rate over the term of the lease.
- Gross Lease
- A lease that includes utilities, repairs, taxes or insurance in the monthly payment.
- Lease Term
- The length of your lease.
- Net Lease
- A lease that does not include utilities, repairs, taxes and insurance in the monthly payment.
- Step Lease
- A lease that includes scheduled increases in rent over a specified period of time.
- Percentage Lease
- A lease that has a set rent amount with an additional amount that is determined by your business’s sales.
- Purchase Option
- The right or requirement to purchase the property at the end of the lease.
- Rentable Space (aka Leasable Space)
- The total square footage rented. This includes all common areas so the number will be most likely be higher than what you requested to rent.
- Usable Space
- The space that your business physically occupies. This does not include common areas such as corridors, elevators, lobbies and rest rooms.
- For a complete Glossary of Real Estate Terms click HERE!
- Source: http://money.howstuffworks.com/office-space10.htm
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