Franchise Mama

It should come as little surprise that we, at The Lease Coach, answer plenty of questions! We thought we would share a few of the most-commonly asked questions here:


1) What does "NNN" mean?

"NNN" refers to the Triple Net Expenses in the property. Triple Net Expenses are also known as Operating Costs and include property tax, insurance, maintenance, etc. As a tenant, you will be required to pay Triple Net Expenses, proportionate to your amount of space leased. Therefore, if you lease 2% of retail space in a shopping centre, you will pay 2% of the mall's Triple Net Expenses.

2) What is the best and least expensive way to negotiate an early lease termination?

The simplest and most cost-effective means for you to terminate your lease early is by approaching your landlord now. Honestly explain to your landlord that your business is not doing as well as you had hoped. In this conversation, be careful to never blame the location or your landlord may get defensive). Many landlords will understand and try to re-lease the space now rather than later ... it is to their benefit to have a tenant who can pay rent rather than a tenant who cannot. Traditionally, there is no penalty for you to in this process.

3) What is a "bonded lease"?

A bonded lease, essentially provides security and insurance for a landlord. If you, as a tenant, do not pay your rent for any reason, the bonder covers the rental rates to the landlord. If you are considering this option, remember that this will eliminate the need to provide the landlord with a personal guarantee.