A lease in which the tenant or lessee is responsible for the entire building except the roof, structure, and foundation. The roof, structure and foundation are the responsibility of the landlord. The landlord would be responsible for any repairs or expenses dealing with those parts of the building. Typically the roof will have a 20 -25 year warranty so that can be very helpful in case of a leaking roof. The landlord in some cases may be responsible for the replacement of the HVAC system while the tenant is just responsible for the maintenance and upkeep of the system. Some net lease retail companies pay a monthly fee on top of the rent to the landlord to take care of the parking lot and common area to make sure it is clean and neat. Typically the landlord will be responsible to fix any potholes or cracks in the parking lot. Depending on the expertise of the landlord they may want to live within driving range of the property in case some roof issues or parking lot issues arise or at least have a property manager close by if needed to deal with any issues properly.
Due to the fact that the landlord has some responsibilities to the property, these net lease retail properties have a higher rate of return or cap. rate on the investment than the Triple Net Retail leased properties.