NNN Lease Calculator

How to Use the NNN Lease Calculator

Commercial rent is quoted per square foot per year, which makes it hard to see what you will actually pay each month. Enter the terms from a lease proposal and the calculator converts them into monthly and total costs.

1. Square footage — the rentable square feet in the proposal (this usually includes a share of common areas).
2. Base rent ($/SF/year) — the quoted rent before operating expenses.
3. NNN charges ($/SF/year) — your share of property taxes, insurance and building maintenance under a triple net lease.
4. CAM charges ($/SF/year) — common area maintenance: cleaning, landscaping, parking lot, security and shared utilities. Some landlords quote CAM inside the NNN figure; if so, enter zero here.
5. Lease term (years) and annual escalation (%) — how long the lease runs and how much base rent rises each year.

Worked Example

A landlord offers 5,000 SF at $24/SF base rent, with estimated NNN of $6/SF and CAM of $3/SF, for 5 years with 3% annual increases.

The headline "$24 a foot" turns into $33/SF all-in in year one and a total commitment of about $862,000 over the term. That total is the number to compare when you have more than one space to choose from.

Reading a Lease Proposal

• NNN and CAM are estimates. They pass through actual costs, so they change every year. Ask for the last two years of actual charges and whether there's a cap on increases to controllable CAM.
• Escalations compound. A 3% annual increase raises base rent 12.6% by year five, not 12%. The calculator compounds escalations the way leases do.
• This calculator holds NNN and CAM flat. In practice they tend to rise with taxes and insurance. Add a cushion if the building is in a fast-reassessing county.
• Free rent and allowances aren't included. If the landlord offers three months free or a tenant improvement allowance, subtract those from the total to get your net effective cost.

Gross vs Net Leases

In a gross or full-service lease, the landlord pays operating expenses and builds them into a higher rent. In a triple net (NNN) lease, you pay base rent plus your share of taxes, insurance and maintenance. To compare a gross quote with a net quote, add the NNN and CAM estimates to the net rent. Our guide to types of commercial leases explains modified gross and the other structures in between.

Questions About This Calculator

Is rentable or usable square footage used? Leases charge on rentable square feet, which includes a load factor for common areas. Use the rentable figure from the proposal.

Can landlords use this too? Yes. Enter your asking terms to see the total lease value, which helps when comparing offers from tenants with different terms.

What does a triple net lease include? See what is a triple net lease for a full breakdown of the three "nets".