What is the primary distinction between a "gross lease" and a "net lease"?

The primary distinction between a gross lease and a net lease lies in the structure of expenses associated with the rental agreement. In a gross lease, the landlord is responsible for covering all operating expenses related to the property, such as maintenance, taxes, and insurance, within the rent charged to the tenant. This means that the tenant pays a single, fixed amount for rent without worrying about additional costs, making budgeting simpler for them.

In contrast, a net lease requires the tenant to pay not only the base rent but also some or all of the property expenses separately. These expenses might include utilities, property taxes, and maintenance costs, which can vary over time and are typically the tenant's responsibility.

The other choices do not accurately define the key differences in expense liability and payment structure that distinguish gross and net leases. While there are various types of leases that allow for rent adjustments or differ in terms and tenant types, these factors do not constitute the fundamental distinction this question addresses. Understanding this core aspect of lease structures is crucial for anyone working in real estate or property management.