Which lease structure results in the highest quoted rent?

Which lease structure results in the highest quoted rent?

• A. Full Service (FS)
• B. Gross
• C. Net
• D. Modified Gross

Answer: (A)

In a Full Service lease, the landlord pays most or all operating costs (maintenance, taxes, insurance, utilities, etc.), so the rent is quoted as an all-in amount to cover those expenses. To ensure the property’s operating costs are covered, the base rent tends to be higher. In contrast, a Net lease shifts those costs to the tenant (base rent can be lower because taxes, insurance, and CAM are paid separately), and a Modified Gross splits some costs between landlord and tenant, placing its base rent between the two. Therefore, the all-in Full Service structure normally yields the highest quoted rent.

In a Full Service lease, the landlord pays most or all operating costs (maintenance, taxes, insurance, utilities, etc.), so the rent is quoted as an all-in amount to cover those expenses. To ensure the property’s operating costs are covered, the base rent tends to be higher. In contrast, a Net lease shifts those costs to the tenant (base rent can be lower because taxes, insurance, and CAM are paid separately), and a Modified Gross splits some costs between landlord and tenant, placing its base rent between the two. Therefore, the all-in Full Service structure normally yields the highest quoted rent.