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Triple Net Lease Calculator

Calculate total NNN lease cost with base rent, taxes, insurance, and CAM

Total Occupancy Cost

$7,188/mo

Annual Cost

$86,250

Per Sq Ft

$34.50

NNN Premium

+56.8%

sq ft
$
$
$
$
%

Total Occupancy Cost

$7,188/mo

Annual Total

$86,250

All-In Per Sq Ft

$34.50

Base Rent Only

$55,000/yr

NNN Premium

+56.8%

Annual Cost Breakdown

Base Rent$55,000
Property Tax$11,250
Insurance$4,375
CAM Charges$15,625
Total Annual Cost$86,250

Lease Escalation Schedule

Year 1
$86,250/yr($34.5/sqft)
Year 2
$87,900/yr($35.16/sqft)
Year 3
$89,600/yr($35.84/sqft)
Year 4
$91,350/yr($36.54/sqft)
Year 5
$93,153/yr($37.26/sqft)

Frequently Asked Questions

Q

What is a triple net lease (NNN)?

A triple net lease (NNN) requires the tenant to pay base rent plus three additional costs: property taxes, building insurance, and common area maintenance (CAM). The tenant pays their proportional share based on leased square footage versus total building area.

  • N = property taxes (typically $3-$8/sqft in commercial)
  • N = building insurance (typically $1-$3/sqft)
  • N = CAM charges (typically $4-$10/sqft for maintenance, landscaping, snow removal)
  • Total NNN charges add 30-60% on top of base rent
  • Landlord collects estimated NNN monthly, reconciles annually
Lease TypeTenant PaysLandlord PaysTypical Use
Gross LeaseBase rent onlyAll expensesOffice
Modified GrossRent + some expensesRemaining expensesOffice/Retail
NNN LeaseRent + taxes + ins + CAMStructure onlyRetail/Industrial
Absolute NetEverything including roof/structureNothingSingle-tenant
Q

How do you calculate total NNN lease cost?

Total NNN Cost = (Base Rent + Property Tax + Insurance + CAM) x Square Feet. For 2,500 sqft at $22/sqft base rent with $12.50/sqft NNN charges: ($22 + $12.50) x 2,500 = $86,250/year or $7,188/month total occupancy cost.

  • Step 1: Get base rent per square foot per year from lease
  • Step 2: Add property tax share (pro-rata by leased sqft)
  • Step 3: Add insurance share (pro-rata by leased sqft)
  • Step 4: Add CAM charges (pro-rata by leased sqft)
  • Step 5: Multiply all-in per-sqft rate by your square footage
ComponentPer Sq FtAnnual (2,500 sqft)Monthly
Base Rent$22.00$55,000$4,583
Property Tax$4.50$11,250$938
Insurance$1.75$4,375$365
CAM$6.25$15,625$1,302
Q

What are typical CAM charges for commercial leases?

CAM charges typically range from $4-$10 per square foot per year for retail and $2-$6 for industrial. CAM covers landscaping, parking lot maintenance, snow removal, common area utilities, security, and property management fees.

  • Retail/strip mall: $6-$10/sqft (higher due to parking, signage)
  • Office building: $4-$8/sqft (elevators, lobbies, HVAC common)
  • Industrial/warehouse: $2-$4/sqft (minimal common areas)
  • Shopping center: $8-$15/sqft (extensive common areas, marketing)
  • CAM caps: negotiate a 3-5% annual increase cap to control costs
Property TypeLow CAMAverage CAMHigh CAM
Strip Retail$6/sqft$8/sqft$12/sqft
Office Class B$4/sqft$6/sqft$9/sqft
Industrial$2/sqft$3/sqft$5/sqft
Shopping Center$8/sqft$11/sqft$15/sqft
Q

What is a typical annual rent escalation in NNN leases?

Most NNN leases include 2-4% annual base rent escalation. Common structures include fixed increases (3% per year), CPI-based adjustments (tied to inflation index), or step increases (specific amounts at set intervals like every 3 years).

  • Fixed escalation: 2-4% per year is most common
  • CPI-based: tied to Consumer Price Index, typically with a floor and cap
  • Step increases: larger jumps every 3-5 years (e.g., 10% every 5 years)
  • Flat lease: no escalation (rare, usually short-term leases only)
  • NNN charges escalate independently based on actual cost increases
Q

How do NNN leases compare to gross leases for tenants?

NNN leases have lower base rent but higher total cost uncertainty. Base rent is typically 20-40% lower than gross lease equivalents, but NNN charges can increase unpredictably. Total cost is often similar, but NNN gives tenants more transparency into actual property costs.

  • NNN base rent: $18-$25/sqft vs Gross: $28-$38/sqft (equivalent)
  • NNN advantage: lower base rent, see exactly what you pay for
  • NNN risk: property tax reassessment can spike costs 20-30%
  • Gross advantage: predictable monthly cost, no surprise reconciliations
  • Negotiate NNN caps to limit annual charge increases to 3-5%
FactorNNN LeaseGross Lease
Base RentLower ($18-$25/sqft)Higher ($28-$38/sqft)
Cost PredictabilityVariableFixed
TransparencyFull breakdownBundled
Annual ReconciliationYes (true-up)No

Example Calculations

1Retail Space: 2,500 sqft NNN Lease

Inputs

Square Footage2,500 sqft
Base Rent$22.00/sqft/yr
Property Tax$4.50/sqft/yr
Insurance$1.75/sqft/yr
CAM Charges$6.25/sqft/yr
Annual Escalation3%
Lease Term5 years

Result

Monthly Occupancy Cost$7,188
Annual Total$86,250
All-In Per Sq Ft$34.50
NNN Premium+56.8%
Year 5 Annual Cost$93,153

Base rent: 2,500 x $22 = $55,000. Tax: 2,500 x $4.50 = $11,250. Insurance: 2,500 x $1.75 = $4,375. CAM: 2,500 x $6.25 = $15,625. Total = $55,000 + $11,250 + $4,375 + $15,625 = $86,250/yr = $7,188/mo. All-in: $86,250 / 2,500 = $34.50/sqft. NNN premium: ($86,250 - $55,000) / $55,000 = 56.8%.

2Industrial Warehouse: 10,000 sqft NNN

Inputs

Square Footage10,000 sqft
Base Rent$12.00/sqft/yr
Property Tax$2.80/sqft/yr
Insurance$1.20/sqft/yr
CAM Charges$2.50/sqft/yr
Annual Escalation2.5%
Lease Term10 years

Result

Monthly Occupancy Cost$15,417
Annual Total$185,000
All-In Per Sq Ft$18.50
NNN Premium+54.2%

Base rent: 10,000 x $12 = $120,000. Tax: 10,000 x $2.80 = $28,000. Insurance: 10,000 x $1.20 = $12,000. CAM: 10,000 x $2.50 = $25,000. Total = $120,000 + $28,000 + $12,000 + $25,000 = $185,000/yr = $15,417/mo. All-in: $185,000 / 10,000 = $18.50/sqft.

Formulas Used

Total Annual Occupancy Cost

Total = (Base Rent + Property Tax + Insurance + CAM) x Square Feet

Calculates the complete annual cost for a tenant in a triple net lease.

Where:

Base Rent= Annual base rent per square foot
Property Tax= Tenant share of property taxes per square foot
Insurance= Tenant share of building insurance per square foot
CAM= Common Area Maintenance charges per square foot
Square Feet= Total leased square footage

Escalated Base Rent

Year N Rent = Base Rent x (1 + Escalation Rate / 100)^(N-1)

Calculates the base rent for a future year based on the annual escalation rate.

Where:

Year N Rent= Base rent per sqft in year N
Base Rent= Starting annual base rent per sqft
Escalation Rate= Annual percentage increase in base rent
N= Lease year number

NNN Premium Percentage

NNN Premium = ((Total Cost - Base Rent) / Base Rent) x 100

Shows how much NNN charges add on top of base rent as a percentage.

Where:

NNN Premium= Percentage added by NNN charges over base rent
Total Cost= Total annual occupancy cost
Base Rent= Annual base rent only

Understanding Triple Net Lease Costs

A triple net lease (NNN) is the most common commercial lease structure for retail and single-tenant properties. Unlike gross leases where the landlord bundles all costs into one rent payment, NNN leases separate base rent from property taxes, insurance, and common area maintenance charges.

Our calculator helps tenants and landlords understand the true total occupancy cost of an NNN lease. Enter your space size, base rent, and NNN charges per square foot to see monthly and annual costs. The escalation schedule shows how base rent grows over the lease term.

When comparing NNN lease proposals, always look at the all-in cost per square foot, not just base rent. A space with $18/sqft base rent and $14/sqft NNN charges ($32 total) is more expensive than $24/sqft base with $6/sqft NNN ($30 total).

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Last Updated: Mar 25, 2026

This calculator is provided for informational and educational purposes only. Results are estimates and should not be considered professional financial, medical, legal, or other advice. Always consult a qualified professional before making important decisions. UseCalcPro is not responsible for any actions taken based on calculator results.

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