Triple Net Lease (NNN) Explained From 9 Real SEC-Filed Leases

What the three nets are, read off real leases

The definitions that rank for this search all say the same thing: in a triple net lease the tenant pays property taxes, insurance and maintenance. That is right as far as it goes. The contracts below show where it stops being enough. We pulled lease agreements that public companies filed as exhibits (EX-10) to their 8-Ks, 10-Qs and 10-Ks, found through EDGAR full-text search, saved each as text and read the operative clauses. Six deals are sale-leasebacks, where a company sold its own building and leased it back (one of them a ground lease); one is a lease written by a small listed landlord, Zoned Properties; one is a pair of bank-branch leases; one is a multi-tenant office lease included as the contrast.

Source: the lease exhibits named in each row, saved from SEC EDGAR on October 12, 2026; accession numbers in the CSV. The 2.5% step is computed from the ground lease's own rent schedule (our arithmetic).

Two things stand out. First, the title is not a reliable guide. Big Lots' lease and the waterpark ground lease both use the triple net label and put the roof and the structure on the tenant; Tuesday Morning's lease calls itself absolute net and yet the landlord buys the property insurance, with the tenant paying it back at “one-twelfth (1/12) of the Insurance Expenses” each month. Second, institutional sale-leasebacks go further than the textbook definition. NNN REIT's master lease has the tenant maintain the buildings “including, without limitation, the roof, walls, structural and non-structural elements of the buildings,” and then says in Section 9.2: “Landlord shall not be required to make any alterations, reconstructions, replacements, changes, additions, improvements, repairs or replacements of any kind or nature whatsoever.”

NNN, absolute net and double net: where the line actually falls

Investors use these labels as if they were standard forms. We do not cite a statute that defines them; in the filings they are shorthand for who carries which cost (our reading). The documents show four positions:

Source: lease exhibits as above; Postal Realty Trust Form 10-K for 2025 (accession 0001628280-26-011212). The cash-flow column is our reading.

Postal Realty's 10-K states the alternative plainly: “The majority of our leases are modified double-net leases, whereby the USPS is responsible for utilities, certain maintenance obligations and reimbursement of property taxes and the landlord is responsible for insurance, roof and structure.” Broadstone Net Lease, whose leases mostly put those costs on tenants, still warns in its 2025 10-K that under a limited number of leases “we may be required to pay some or all of the expenses of the property, such as the costs of environmental liabilities, roof and structural repairs.” If you buy a single net-leased building, the equivalent question is simple: find the repair section and read who replaces the roof.

Gross lease vs triple net, and what “$6 NNN” means

A rent quoted with “NNN” after it is base rent per square foot per year, and the tenant pays the property costs on top. A gross or base-year rent already includes most of the landlord's costs, so the two numbers are not comparable. The filings give one of each:

• Zoned Properties' Chino Valley lease (absolute net): $70,000 a month from July 2026 on 97,312 square feet is $8.63 per square foot per year, net (our arithmetic). The tenant also pays all “Operating Costs,” which the lease defines to include insurance and the “maintenance, repair and replacement of the foundation, roof, walls.” The rent schedule also adds an estimated sales or rental tax: $750 on each $25,000 month.
• RF Industries' Parsippany office lease (base year): $13.50 per rentable square foot for months 13 to 72 and $15.50 after, with the tenant paying only its 1.64% share of the amount by which taxes and operating expenses exceed their 2023 level. The landlord maintains the roof and structure, “the cost of which shall be included as a part of Operating Expenses.”

So “$6 NNN” means $6 per square foot per year of base rent, with taxes, insurance and maintenance paid by the tenant on top (our reading of how these leases quote rent). To compare it with a gross rent, add the building's costs per square foot to the NNN figure.

Rent bumps and term: what the numbers do over time

The escalator decides whether a net lease keeps up with inflation. The rent schedules attached to these leases let you watch it compound:

Source: rent schedules and rent sections of the lease exhibits; totals and multiples computed by the saved script sources/scripts/calc.py (our arithmetic).

Read the escalator words, not just the percentage. NNN REIT's clause is a cap, not a floor: rent rises by the lesser of two times the CPI increase or 2.0%, so in a low-inflation year it rises by less than 2%. The 2008 Embassy Bank lease says the new rent equals the prior year's rent “multiplied by two and seventy five hundredths percent (2.75%)”, and only the parenthesis that follows, “the prior year's rental plus an increase of 2.75%”, makes the intended meaning clear (our reading). The bank's 2015 branch lease ties increases to CPI and caps them at 3%.

What the buyer paid against the first year's rent

When a company sells its building and leases it back, the 8-K usually gives the price and the lease gives the rent. Dividing one by the other gives the first-year yield the buyer bought (our arithmetic, before the buyer's own costs and financing):

Source: 8-Ks and lease exhibits as listed in the CSV; ratios from sources/calc_output.txt (our arithmetic). Big Lots' rent schedule is redacted, so its yield cannot be computed from the public exhibit. Tuesday Morning's warehouse lease ran only 30 months plus one 12-month extension.

The waterpark deal shows why the price line deserves a second read. The buyer paid $1 million for the land and $49 million for a pledge of the membership interests in the company that holds the stadium leasehold, and the rent is $4.375 million in year one. The 8-K also gives the tenant an option to buy the property back between December 1, 2027 and November 30, 2034. A rent stream sized to $50 million on a $1 million parcel, backed by other collateral and paired with a buy-back option, works economically more like financing than like owning land (our reading); the lease itself states that it “is a “true lease” and does not represent a financing statement, financing lease, financing agreement.”

The clauses that decide whether passive income stays passive

• Master lease, all or none. NNN REIT's lease says it “constitutes a single master lease of all, but not less than all, of the Demised Properties.” A tenant cannot keep the strong stores and hand back the weak ones. Getty Realty's 10-K counts 962 of its properties under 62 unitary or master triple-net leases, and Essential Properties says master leases were 66.8% of its annualized base rent.
• Change of control. In NNN REIT's lease a transfer of 49% of the tenant or the guarantor needs the landlord's consent, which may be withheld at its sole and absolute discretion. Big Lots' lease offers, as one route, a 5% rent increase plus a letter of credit if control of the guarantor changes.
• Subletting profit. Commercial Vehicle Group must pay the landlord 50% of any rent it collects above its own rent on a permitted transfer.
• Purchase options. Zoned Properties' tenant exercised “purchase rights set forth in certain existing lease agreements”; the Chino Valley sale closed on September 2, 2026, which ends that rent stream for the landlord.
• Landlord carve-outs. Even the strictest leases leave something with the owner: Live Ventures' lease excludes “Lessor's Income Taxes”; Big Lots' lease excludes the landlord's taxes measured by net income, franchise and transfer taxes; the 2008 Embassy lease puts the sewer “tie in” cost on the lessor.
• Condition and capital work. Commercial Vehicle Group took its plant “AS IS”, “WHERE-IS” and “WITH ALL FAULTS” and must commission annual inspections of the roof and the heating and air conditioning; Precision Metal Works must “Replace Roof within first 36 months of lease term” and spend at least $500,000 in the first 60 months.
• Redactions. Big Lots' public exhibit shows its rent schedule as “[REDACTED]” under Item 601(b)(10)(iv) of Regulation S-K. Investors in a DST or a private fund often see no more than a summary either.

When the tenant fails: the lease is only as good as the tenant

Two of the companies in our sample filed for bankruptcy after signing. Tuesday Morning filed Chapter 11 on February 14, 2023 in the Northern District of Texas, about two years into its 120-month headquarters lease. Big Lots filed on September 9, 2024 in the District of Delaware (Case No. 24-11967), about a year after the Apple Valley lease began. The documents we saved do not say what happened to these particular rents afterwards, and we do not guess. What they show is that absolute-net wording, a parent guaranty and a master-lease structure protect the owner against costs; none of them replaces the tenant's ability to pay (our reading). That is why net-lease REITs report tenant credit next to lease terms: Realty Income says 32.2% of its annualized base rent came from investment grade clients at December 31, 2025.

The portfolio view: what 8 net-lease REITs report

For an investor buying net lease through a REIT, a DST or a fund rather than a single building, these are the 10-K figures to compare. All are as of December 31, 2025:

Source: Forms 10-K for fiscal 2025 of each company, filed February 2026; accession numbers in the CSV.

Two readings (ours). The spread in remaining lease term, from about 4 to 14.4 years, tracks the spread in lease type: Postal Realty's shorter leases come with landlord-paid roofs and insurance. And the bump that compounds is small: Broadstone's 2.1% and Essential Properties' 1.8% are portfolio averages, while the individual leases above range from a CPI-capped 2% to 3.5%.

What a net-lease investor can do with this

• Ask for the lease, not the summary. If you are buying a single-tenant building or a DST interest, read the repair section for the words roof, structure and replace, then the escalator, the renewal rent, the transfer clause and any purchase option. If the sponsor offers only a one-page abstract, ask why.
• Price the roof. In a modified double-net or base-year lease the roof and structure are yours. In an absolute net lease they are the tenant's, for as long as the tenant is solvent.
• Compute the first-year yield yourself: year-one rent divided by the price. Then check whether the bump is fixed, tied to CPI or capped, and what happens at renewal (market reset, a 102% floor, or flat).
• Check the tenant, then the guarantor. Several of these leases are signed by subsidiaries and guaranteed by a parent; the guarantor's credit is what you are buying.
• Compare against the REITs. A single NNN building with six years left is a different asset from a REIT with 10.2 years of weighted term over 3,692 properties. Our reviews of Blue Owl Real Estate Net Lease Trust and ExchangeRight Essential Income REIT show what the non-traded versions disclose.
• If the money comes from a property sale, the deadlines in our 1031 exchange rules guide and the comparison of UPREIT contributions and DSTs apply before you sign anything.

FAQ

Sources, read and saved on October 12, 2026 from SEC EDGAR: lease exhibit EX-10.8 to RumbleOn's Form 10-Q (0001596961-23-000047) and RumbleOn's 8-K (0001213900-23-076703); EX-10.1 to Big Lots' 8-K (0000768835-23-000101) and its Chapter 11 8-K (0000768835-24-000062); EX-10.2 to Hall of Fame Resort & Entertainment's 8-K (0001213900-22-070683); EX-10.1 to Zoned Properties' 8-K (0001213900-26-001100) and its 8-Ks filed April 22, July 6, August 18 and September 4, 2026; EX-10.2 to Commercial Vehicle Group's 8-K (0001628280-26-022937); EX-10.120 to Live Ventures' 8-K (0001628280-23-025729); EX-10.3 and EX-10.4 to Tuesday Morning's 8-K (0001104659-21-000296) and its Chapter 11 8-K (0001104659-23-022784); EX-10.10 and EX-10.15 to Embassy Bancorp's 10-K (0001449794-21-000005); EX-10.1 to RF Industries' 8-K (0001437749-22-024473); and the fiscal 2025 Forms 10-K of NNN REIT, Realty Income, Getty Realty, NETSTREIT, Alpine Income Property Trust, Postal Realty Trust, Broadstone Net Lease and Essential Properties Realty Trust. Yields, rent sums, per-square-foot rents and percentage steps are our arithmetic from a saved script; readings of clauses are ours. This is analysis of public documents, not investment, legal or tax advice.