What is a defining feature of a triple net lease?

A defining feature of a triple net lease is that the tenant is responsible for property taxes, insurance, and maintenance. In this type of lease, the tenant takes on a more significant role in the financial responsibilities of the property, which typically means covering costs that are usually the landlord's responsibility in other types of leases.

By assuming these costs, the tenant effectively has control over the property’s operational expenses, which can lead to lower base rent compared to other leasing structures. This arrangement is common in commercial real estate and allows landlords to predict their income more reliably since they are not directly handling these variable expenses. Understanding this feature highlights why triple net leases are sought after in certain investment scenarios, particularly for property owners looking to minimize management involvement and for tenants wanting to tailor the expenses and maintenance of the property to their business operations.

The other options describe arrangements that do not align with the characteristic structure of a triple net lease. For instance, the landlord paying all operating expenses is typical of gross leases, while a lease duration being fixed at three years does not pertain specifically to lease type classification. Additionally, tenants paying only utilities would not accurately reflect the extensive cost responsibilities associated with a triple net lease.