Direct answer
What does Gross lease mean?
A lease in which the landlord pays specified property operating expenses from the rent received.
Exam cue: The actual lease controls which expenses are included and whether increases are passed through.
What does it look like in a question?
New York example
An office tenant pays one rent amount while the landlord pays ordinary building taxes and operating costs.
Common exam trap
What should you not confuse it with?
Gross lease does not always mean every possible cost is included.
Related commercial and investment terms
Cash flowMoney remaining or changing hands during a period after the receipts and payments included in the stated calculation.Effective gross incomeIncome expected or received after vacancy and collection loss, plus other property income included in the analysis.LeverageThe use of borrowed money to finance part of an investment.LiquidityThe ease and speed with which an asset can be converted to cash without a substantial loss in value.Net leaseA lease under which the tenant pays specified property expenses in addition to rent.Net operating incomeProperty income remaining after vacancy and operating expenses but before debt service and income taxes in the standard real estate formula.
Sources used2 references with section locators
The curriculum citation confirms exam scope. Definition and rule citations support the explanation itself. Links and locators were checked on August 26, 2026.
- Real Estate Salesperson 77-Hour CurriculumNew York State Department of StateSupports: Exam scopeSection: Subject 16, Commercial and Investment Properties
- Real Estate License Law, March 2026New York State Department of StateSupports: DefinitionSection: Department of State reference glossary entry for Gross lease
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Put the term back into its full subject.
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