NNN lease calculator
Base rent plus CAM, property tax, and insurance — the total occupancy cost under a triple-net lease, with escalation and a year-by-year breakdown over the full term.
Year 1, $/SF/yr
$26
Year 1 monthly cost
$10,833
Total cost over term
$677,822
Year-by-year cost
| Year | $/SF/yr | Annual cost |
|---|---|---|
| Year 1 | $26 | $130,000 |
| Year 2 | $27 | $132,700 |
| Year 3 | $27 | $135,481 |
| Year 4 | $28 | $138,345 |
| Year 5 | $28 | $141,296 |
NNN charges (CAM, tax, insurance) are modeled flat since they're a pass-through of actual operating costs — expect them to be trued up annually against actual expenses rather than following a preset schedule.
The formula
A worked example
A 5,000 SF retail space quotes $18/SF/yr base rent, $4 CAM, $3 property tax, and $1 insurance — $26/SF/yr total, or $130,000 a year ($10,833/month) in year one. With a 3% annual base-rent escalation over a 5-year term, total occupancy cost across the full lease comes to roughly $677,822 — see the year-by-year breakdown above for exactly how that climbs each year.
NNN vs. gross vs. double-net
One bundled rent figure. The landlord covers property tax, insurance, and CAM out of that rent — simplest for the tenant to budget, but usually a higher headline rate.
Tenant pays base rent plus property tax only. Less common than NNN.
Tenant pays base rent plus property tax and insurance, but not CAM — the landlord still handles common-area upkeep.
Tenant pays base rent plus all three: property tax, insurance, and CAM. The most common structure for retail and standalone commercial space.
CAM reconciliation
CAM is usually billed monthly as an estimate, then reconciled annually against the landlord's actual common-area expenses for the year. If actual costs ran higher than estimated — a bad winter with heavy snow removal, an unexpected repair — tenants can receive a reconciliation bill for the shortfall, sometimes months after the year in question closed. Worth budgeting a buffer above the initial CAM estimate rather than treating it as a fixed number.
Frequently asked questions
NNN (triple-net) means the tenant pays base rent plus a pro rata share of three additional costs: property tax, building insurance, and common area maintenance (CAM) — utilities, landscaping, parking lot upkeep, and similar shared expenses. The "net" refers to what the landlord receives net of these costs, which the tenant covers directly.
Total occupancy cost per year = square footage × (base rent + CAM + property tax + insurance, all per square foot). The base rent is negotiated; CAM, tax, and insurance are typically estimated at lease signing and trued up annually against actual costs, which can mean an unexpected reconciliation bill if estimates ran low.
A gross lease bundles everything into one rent figure, with the landlord covering operating costs. A single-net lease has the tenant covering property tax only. A double-net (NN) lease adds insurance. A triple-net (NNN) lease adds CAM on top of that — the tenant covers all three. NNN is the most common structure for retail and standalone commercial buildings.
Base rent escalation is a negotiated term, fixed at lease signing, usually a flat percentage or tied to CPI. CAM, tax, and insurance aren't negotiated the same way — they're a pass-through of the landlord's actual costs, so they move with real expenses rather than a preset schedule, and get reconciled annually rather than escalated on a fixed curve.
An annual true-up where the landlord compares the CAM estimate charged to tenants during the year against actual common-area expenses, then bills (or credits) each tenant the difference based on their pro rata share. A CAM estimate that ran meaningfully below actual costs can produce a real, sometimes unexpected reconciliation bill.
Both conventions exist and vary by market and broker. Commercial rent is very commonly quoted as an annual $/SF figure (e.g. "$26/SF/yr NNN") even when billed monthly, so always confirm which convention a specific quote is using before comparing two properties.
Calculate your own NNN cost above, free, or compare deals with different concessions on the net effective rent calculator.
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