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Glossary of Real Estate Terms
This Glossary has
been provided as a courtesy to assist you in
gathering information relative to real estate.
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Net Absorption:
The square feet leased in a specific geographic
area over a fixed period-of-time after deducting
space vacated in the same area during the same
period. |
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Net Lease:
A lease in which there is a provision for the
tenant to pay, in addition to rent, certain
costs associated with the operation of the
property. These costs may include property
taxes, insurance, repairs, utilities, and
maintenance. There are also “NN” (double net)
and “NNN” (triple net) leases. The difference
between the three is the degree to which the
tenant is responsible for operating costs. |
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Net Rentable Area:
The floor area of a building that remains after
the square footage represented by vertical
penetrations, such as elevator shafts, etc., has
been deducted. Common areas and mechanical rooms
are included and there are no deductions made
for necessary columns and projections of the
building. (This is by the Building Owner and
Manager Association - BOMA, Standard). |
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Net Square Footage (S.F.):
The space required for a function or staff
position. |
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Non-Compete Clause:
A clause that can be inserted into a lease
specifying that the business of the tenant is
exclusive in the property and that no other
tenant operating the same or similar type of
business can occupy space in the building. This
clause benefits service-oriented businesses
desiring exclusive access to the building’s
population (i.e. travel agent, deli, etc.). |
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Non-Recourse Loan:
A loan which bars a lender from seeking a
deficiency judgment against a borrower in the
event of default. The borrower is not personally
liable if the value of the collateral for the
loan falls below the amount required to repay
the loan. |
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Normal Wear and Tear:
The deterioration or loss in value caused by the
tenant’s normal and reasonable use. In many
lease the tenant is not responsible for “normal
wear and tear”. |
