how do i know what percent of annual tax i pay on a nnn lease

In Property Management - Asked by T C. - Apr 7, 2014
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Answer(s)

Margaret B.
Broker/Agent
Glen Ellyn, IL

The percentage you pay will usually be divided by the number of units in the building. Say for example...that there are six tenants in a strip mall...you would pay 1/6th of the total taxes. This should also be clearly noted in the proposal and lease terms. Although that mat not be true of all leases, each lease is different, so it depend on how your broker negotiates the terms between you and the landlord. Please feel fee to contact me with any more questions,

Apr 7, 2014
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Ben T.
Broker/Agent
Cincinnati, OH

In my experience the amount you will pay in tax will be a prorated amount based on the square footage you lease. For instance if the taxes on a 10,000sqft retail center is $30,000 annually and you lease 1,500sqft you will owe $4,500 annually (1,500/10,000X30,000) or an additional $3 per square foot .

Apr 8, 2014
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Glen W.
Lender/Mortgage Broker
Atlanta, GA

Good question, the answers below are correct, but your percentage of the total space should be spelled out in the lease. There should be a separate section in the lease that spells out the percentage of total square footage and the items included in the NNN charge, many times there are floors for NNNs and the amount increase per year is sometimes capped as well

Apr 9, 2014
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Dalip S R.
Broker/Agent
Lumberton, TX

Take the total amount of annual taxes of this property and divide it into the total square footage you have. Look at your lease and see what square footage you have and what does it says about property taxes. Thanks Good luck.

Apr 9, 2014
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Jason T.
Broker/Agent
Green Bay, WI

All these answers are partially correct. In my experience CAM is divided by a prorata share, your fraction of square footage over the total. However. There are CAM zones in some developments. Perhaps you do or don’t have access to some common area Amenities? Or have a drive though for example. Your lease will have the formula used. If you have questions as the listing broker. Or better yet consult a local real estate attorney.

Apr 10, 2014
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Tony K.
Broker/Agent
Los Angeles, CA

For commercial and industrial real estate: Proportionate or Pro Rata share of the unit/suite/space portion of the total building or project size.

Apr 16, 2014
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