A software designed to compute lease funds based mostly on a tenant’s gross income, usually utilized in industrial actual property. As an example, a retail tenant would possibly pay a base lease plus a share of their gross sales exceeding a predetermined breakpoint. This strategy permits landlords to share within the success of thriving companies whereas providing tenants flexibility throughout slower intervals.
This methodology of lease calculation presents distinct benefits for each landlords and tenants. It gives a built-in mechanism for lease changes tied to enterprise efficiency, selling a mutually useful relationship. Traditionally, such preparations have been prevalent in retail settings, significantly buying malls, however their utility extends to different industrial sectors as properly. This strategy can foster a collaborative surroundings the place landlords are incentivized to help tenant prosperity.
