Ace the Illinois Real Estate Exam 2024 – Unlock Your Property Pro Potential!

The correct answer is a net lease. In a net lease agreement, the tenant pays a base rent amount plus additional costs directly related to the property, such as property taxes, insurance, or maintenance expenses. This structure allows landlords to pass certain operational costs onto tenants, which is beneficial for property owners as they can have a more predictable cash flow while sharing the financial responsibility for property upkeep. In contrast, a gross lease typically includes all operating expenses within the monthly rent, meaning the landlord covers costs like utilities and property taxes. A double net lease requires the tenant to pay rent plus two specified expenses—usually property taxes and insurance—while a triple net lease includes rent plus three key expenses: property taxes, insurance, and maintenance costs. Thus, the net lease sits in the middle, requiring tenants to cover one additional expense along with their rent.