Expenses may include property taxes, landlords insurance, liability insurance and maintenance. This type of lease can be attractive to both landlords and tenants. It signifies the level of risk and is just one measurement of the equity return on investment. It requires the tenant to pay base rent along with the three nets which are: Property taxes. Rental real estate activities are found in several of the labyrinth rooms of the Code. Triple net leases are common with large single tenant properties such as national restaurant chains and are popular because they offer a turn-key investment. This includes maintenance, repairs, property taxes, insurance. However, NNN leases are often used for single. ” Deal Structure, Approvals and Timing To finance the transaction, HPT has secured commitments from lenders for an up to $2. A single triple. The second option is a double net lease, where the tenant is responsible for paying rent, taxes, and insurance. Real estate rented under a triple net lease is not eligible for this safe harbor. To make this legal template accessible to everyone, it is offered on a “Pay What You’re Able” basis with no minimum (enter $0 if you’d like) or maximum (your support helps keep the content coming – typical legal document templates sell for $100+). Tenants can renegotiate triple net leases, and property owners may be asked to come to the negotiating table despite having a signed lease agreement in place. The landlord "nets" the base rent, with no obligation to spend money on property operations. NNN – Triple Net – a triple net lease rate is an agreement in which the tenant. This is also by no small margin as the next highest yield is a cool 340 basis points. GIVE AAA—STARTING AT $49. It is calculated on an “all-in” basis. Triple-net properties hold the tenant or lessee responsible for costs on building insurance, maintenance, and real estate taxes in addition to all other typical fees. Accidental death & dismemberment (AD&D) insurance provides coverage if you lose a limb or your death is the result of an accident. The board voted. The tenant is responsible for paying rent as well as all expenses. Single Net. Dollar Tree is an attractive tenant for the Net Lease Investor who prioritizes a higher cap rate. That means that the tenants will have enhanced control and transparency over expenditures. limited liability and individual tax returns, conducting tax research, performing basis adjustments. – Any property rented on a triple net basis. In such an agreement, the landlord is not liable for property taxes, insurance premiums and maintenance costs associated with the property. Carey announced the spinoff of its office assets into a publicly traded REIT called. A triple net lease, also known as an NNN Lease, is a lease in which the tenant agrees to pay their pro-rata share of all expenses. The tenant pays their pro rata share of the property taxes, property. Example: If an investor is selling a triple net shopping center for $1,000,000, and has a net adjusted basis of $500,000, the investor will have a gain of $500,000 upon the sale of the property. There are many things you can do on an individual basis: consume less; walk or cycle instead of driving; recycle; use less water, and perhaps most importantly contact your elected representatives. definition. You might be quoted: $32. A triple net lease (NNN) benefits commercial landlords by reducing the potential risk that comes with a commercial lease. Full-Service Lease Rate: 3,000 SF x $30 per SF per year = $90,000 per year, or $7,500 per month. ”. 21x to approximately 1. The owner usually maintains responsibility for repairs, including major. In a NNN, the tenant pays for all expenses except structural and some insurance. In a sales-type or direct financing lease, the lessor derecognizes the leased asset and recognizes a lease investment on its balance sheet as discussed in LG 4. Landlords in triple net leases can take small comfort from the fact that failure to meet the safe harbor does not preclude a rental real estate enterprise from being a section 162 trade or business, as such a determination is based on all facts and circumstances. 3. A triple net lease (triple-Net or NNN) is a lease agreement on a property where the tenant or lessee agrees to pay all real estate taxes, building insurance, and maintenance (the three "nets") on the property in addition to any normal fees that are expected under the agreement (rent, utilities, etc. This includes standard property repairs. If there’s a hike in taxes or insurance, the tenant rather than the owner assumes the additional financial liability. After such stunning growth, however, e-commerce sales in the US rose "only" 7. The triple net lease amount is $8 per sq. e. A triple net lease is a type of commercial real estate lease in which the tenant pays a base rent to the landlord and pays their own operating expenses directly to the relevant service and utility providers. 199A allows taxpayers other than corporations a deduction of 20% of qualified business income earned in a qualified trade or business, subject to certain limitations. A Triple-Net Lease, or NNN lease, is a type of commercial real estate lease commonly used for restaurant or retail franchises in the United States. 33 But triple net lease landlords also should consider renegotiating those. 13 Triple negative breast cancers have a poorer prognosis than other subtypes, in part because treatment advances have lagged behind other molecular subtypes. However, the rental income is specified service income because Partnership B is an SSTB and the two partnerships are commonly owned. Gross Lease. In such a lease, the tenant or lessee is. Triple Net Space Lease. The “N” stands for “net of” or exclusion of certain expenses which typically include utilities, property taxes, building insurance. Double Net Lease: In a double net lease, the tenant pays their base monthly rental amount plus two of the three major operating expense categories: taxes, insurance, and maintenance. Let's say this amount is $20,000 a month. When the value of the. 50-$1. For example, if a 100,000 square foot office building has total NNN operating expenses of $700,000, the NNN expense for the entire building would be $7 per square foot. It doesn’t matter whether you are the CEO of Google, a venture capitalist, a stockbroker, an entrepreneur or a simple student - we all have to admit that this world revolves around money. Shop now. Since you're taking on a share of these financial obligations, you're receiving a lower rental rate in. Depending on your space needs, required fixtures, and desired amenities, you will be quoted for one of the following:. If you’re wondering why a tenant would agree to such an arrangement, read on. Reimbursable building level operating expenses are expected to be $5. 8% net investment income tax imposed by Sec. 1. When it comes to the QBI deduction, however, landlords who hold triple net leases are not considered to be. Discover the benefits of a triple net lease (NNN) in commercial real estate. Generally, a lease that requires that a Tenant pay additional expenses is known as a “triple net” (“NNN”) lease. Net asset value is the value of a fund’s assets minus any liabilities and expenses. 3 billion all-stock deal. Triple net cannabis leases allow landlords. As we’ve seen throughout this article, the modified gross lease is a lease structure where the landlord and the tenant both share the cost of operating expenses. g. In commercial real estate, a common lease structure is the triple net lease, often abbreviated as “NNN Lease”. 5% of unadjusted basis limitation. triple negative because they are ER-, PR- and HER2-. The triple net lease (NNN) passes the costs of structural maintenance and repairs to the tenant in addition to rent, property taxes, and insurance premiums. , property taxes, insurance, utilities, repairs, etc. The properties are available individually, in pools, or as a portfolio. A triple net lease also called an NNN lease, is one in which the tenant handles the basic rent, monthly property taxes, insurance, and maintenance. • Taxation on a gross basisDouble Net Lease: An agreement in which the tenant is responsible for both property taxes and premiums for insuring the building. g. Figuring a shareholder’s stock and debt basis. Save. There are benefits to the property owner as well, as a triple net lease provides more stable income to the owner. Performing a 1031 exchange for a NNN lease property can save those tax dollars. 35 million-square-foot property was 98 percent leased to 15 tenants, according to the DBRS report. A triple net lease is a type of commercial real estate lease in which the tenant pays a base rent to the landlord and pays their own operating expenses directly to the relevant service and utility providers. Download. In an NNN lease, the tenant is typically responsible for paying property taxes, property insurance, and property maintenance costs, in addition to their. "As a result, both parties have entered into a lease agreement for a period of 10 years on a triple net basis for Menara Maybank, concurrently with the tenancy agreement for Menara Merdeka 118. In a triple net lease, the landlord is responsible for: The Mortgage: The property owner uses the income stream produced by tenant rents to pay the mortgage on a monthly basis. Triple Net Leases (NNN) Double Net Leases (NN) Single Net Leases (N) Triple net lease/“NNN” lease. However, properties leased on a triple net basis were not eligible to rely on this safe harbor. Triple net lease properties tend to carry a lower interest rate than gross lease propertiesThe type of leases in place at a building can shift property financials considerably. The accounting method you choose will depend on how you’re most comfortable tracking and reporting income. Triple Net Leases – Triple net leases involve part of the costs of property taxes, CAM costs, and property insurance expenses. These increases could occur for instance because property taxes or insurance rates rise, or simply because of inflation. Landlord s Representative. However, a NNN amount per year of $10 would yield $10,000 a year ($10/sqft. Posted Sep 18, 2020. When Viva purchased Chin Bee Avenue in Jan 17, that was a sale and leaseback scheme transaction. However, if the property is retained in the trust or distributed to another trust, the income tax status of the trust after expiration of the initial term must be determined. Stability and predictability serve both the landlord and tenant. In the context of commercial leasing, triple net (often identified as NNN) indicates a lease requiring the tenant to pay a share of the landlord’s costs related to the building. The term "net lease" is often used as a shorthand expression for any of these arrangements. For example, in Neill, the Board of Tax Appeals (the precursor to the Tax Court) held that a single property leased on a triple-net basis is not a Code Section 162 trade or business. In addition, lease terms are long, often 10 to 20 years, resulting in low vacancy rates. As the original owner of the property, it makes perfect sense to continue to lease on triple net basis. 1368–1(d)(1) applies; and (iii) Exceeds the amount of the corporation's AAA properly allocable to that distribution. Suppose the owner has exhausted the property's depreciation. 5%. A conventional triple net lease has a tenant being responsible for property taxes, insurance premiums and property maintenance costs. That is. That's the best part about a triple net lease. Starbucks would be paying for your insurance, your taxes, all the building repairs, the parking lots, windows, roof, electrical, and more. In addition, many triple net leases provide long-term investment stability for the landlord. In most NNN leases, these costs, along with base rent, are charged to tenants over. A triple net lease, or a net lease, is one of the most common lease structures. However, in recent years, the triple net lease structure is also finding its way into office and industrial, too. The modified gross. S has AAA of $2,500 and AE&P of $6,750 on Jan. Net Lease: A provision that requires the tenant to pay a portion or all of the taxes, fees and maintenance costs for the property in addition to rent. The lease on the space ranges from $22 to $25 per square foot, presumably depending on location, windows, and the desirability of the. However, as leasing practices have evolved, and depending on the property's location or local custom, the term. or annual basis based upon their prorata share of the premises. Both tenants have triple-net leases; all operating expenses are passed through to tenants. Office, industrial, retail, and restaurant space landlords offer lease space on a triple net basis. This article considers 9 leading REITs that lease free-standing properties on a triple net basis. A triple net lease, also known as an NNN lease, is a lease agreement in which the tenant is responsible for all the ongoing expenses of the property, including property taxes, insurance, maintenance costs, and paying the rent and utilities associated with the property. The allocation of costs between the landlord and tenant may vary depending on the negotiated agreement. See Form 7203 and its separate instructions, which have been developed to replace the 3-part Worksheet for Figuring a Shareholder’s Stock and Debt Basis and its related instructions formerly found in the Shareholder’s Instructions for Schedule K-1 (Form 1120-S). 5MM) were $6. Step 3: Set up a chart of accounts. 368(a)(1)(D) are not met. You can determine these groupings aurally by listening carefully and tapping along to the beat. Your total monthly rental income drops $900, from $15,000 to $14,100. • Reasonable triple net lease rates average $21. $0. Download the Standard Industrial Lease – Triple Net Lease (NNN) Template. This article considers 9 leading REITs that lease free-standing properties on a triple net basis. us Leases guide 2. , common area maintenance or services such as security). These increases could occur for instance because property taxes or insurance rates rise, or simply because of inflation. A lease that requires only that basic rent be paid, usually on a monthly basis, is known as a “gross lease”. In addition to “base rent” calculated on a square footage basis, in a triple net lease, the tenant is also responsible to pay its proportionate share of taxes. Industrial Real Estate Triple Net Lease . Section 30 discusses the legal basis for the enforcement of the triple net lease contract. For example, consider a manufacturing company that leases a building from its shareholder in a triple net lease, and the property’s operating statement has rental income and interest expense. Rising property taxes lower the internal rate of return (IRR) of gross lease properties. Commercial Lease Calculator - Properties Quoting Yearly Rates. Owners, Operators Get in Sync. With 306 properties spanning all areas of the triple-net space, the REIT boasts of a 99. Some items you can’t depreciate: the land the property sits on. The triple net costs are estimated at the beginning of the lease, but they can go up or down based on the actual expenses accrued. These leases transfer all taxes, utilities, maintenance, insurance, and rent obligations to the tenant. Tax Savings from a 1031 Exchange. A triple net lease is a real estate agreement in which the tenant pays all expenses associated with the property, such as taxes, insurance, and maintenance costs. 1 Lessors: Sales-type and direct financing leases. . Triple Net Lease: In a triple net lease—also known as a net-net-net lease, the tenant pays all three expense categories. NNN means “net, net, net” and describes lease agreements that are net of property taxes, insurance, and maintenance expenses for the landlord. In real estate, "NNN" is an abbreviation for the phrase "triple net lease. AND . This property is the basis for the common alcohol thermometer and the original mercury thermometers. However, now that the commercial property is no longer considered to be a triple net leased property, the owner will be able to enjoy the 20% QBI deduction of $30,000 and pay income tax on the net. Unlike double net leases, which require tenants to pay some degree of the rented property’s maintenance costs, real estate taxes, fees, and property insurance, a triple net lease requires the tenant to pay all of those costs, in addition to rent and utility bills. Real estate changes hands all the time. 1. , roof, structure, parking lot) costs of the property. Use this figure and multiply it by 12 to get the total cost for property taxes, insurance, upkeep, and communal area charges. With a tripe net lease agreement, tenants pay most of the expenses associated with the leased property, including property taxes, repair,. It examines their potential for external growth and for internal growth. Financial advisory and wealth management firm Geller & Company rounds out the top three with 126,000 square feet on the 15th through 18th floors. In other words, tenants are required to pay all. A triple-net (NNN) commercial lease agreement is a contract between a landlord and a tenant that pays for the three (3) ‘nets’, property insurance, real estate taxes, and common area maintenance (CAM). A typical triple-net lease in the senior living space often involves a pooling of multiple properties by a single property owner, which are then leased to an independent operator, with set annual. U. A single net lease is a form of pass through lease in which. " But the firm's new project. ; Triple Net. Example: Building maintenance costs are $20,000 per year. There is some intermediate distant, generally a bit longer than 0. It is a type of polyphase system employing three wires (or four including an optional. In a modified gross lease, the tenant is responsible for a few (but not all) of the operating expenses of. Formerly known as National Retail Properties, NNN REIT (NYSE:NNN), is, as its name suggests, a REIT focused on properties leased out on a triple-net basis. The triple net (NNN) lease is a lease agreement structure where the tenant pays all of the operating expenses for the property. Single Net Lease: A commercial real estate lease agreement in which the tenant is required to pay property taxes in addition to rent. 00 number is your Base Rent. S. 46x. Three-phase transformer with four-wire output for 208Y/120 volt service: one wire for neutral, others for A, B and C phases. Through that agreement (which can span decades), the tenant pays daily operational and insurance costs, while the landlord. reporting cash flows on a net basis 22-24 foreign currency cash flows 25-27 extraordinary items 28-29 interest and dividends 30-33 taxes on income 34-35 continued. A triple net lease is one of the more common lease structures that you’ll find in commercial real estate. The modified gross. If you are a commercial real estate investor, you may have considered investing in properties that are leased to tenants on a triple net basis. A triple net lease , also called NNN leases, is a legal contract between commercial tenants and landlords. Only the components that are integral to the right to use an underlying asset are considered lease components. Each N stands for the net and signifies one of the aspects of this agreement. An NNN lease is an attractive option for many renters because it allows them. g. acquired a skilled nursing center in Kansas City. The flip side of the triple N lease is the lower rent and lower net income for the landlords. The three most common expenses charged back are property taxes, insurance, and maintenance, often called the "three nets". A single net lease is a form of pass through lease in which. That is a real expense, so real AFFO is not the stated $1. The structure of triple net leases usually has lower base rates but is more profitable. This is, by far, the most common type of commercial lease for office and retail spaces. Real estate investment trusts (REITs) Real estate investment trusts (REITs) are funds that you can buy shares from on the open. This basically means that the tenant is responsible for payment of real estate taxes and operating expenses. For a lessor, there might be problems with the building falling into disrepair. “Ask yourself what you want to get out of moving,” Prikker says. , True or False: A CPI clause allows rental increases based on an external scale, True or False: In a sublet, the tenant gives up only a portion of their leasehold estate. Gift AAA. A triple net lease, also known as an NNN Lease, is a lease in which the tenant agrees to pay their pro-rata share of all expenses associated with property maintenance, taxes, and insurance, in addition to a predetermined base rental rate. For property investors, who want to own a revenue-generating property and pay. Landlord hereby leases to Tenant and Tenant hereby leases from Landlord for the Lease Term, at the rental, and upon all of the terms and conditions set forth herein, the. Included in the $7,500 per month amount is both the base lease rate and the operating expenses. This type of arrangement stems from industrial real estate properties, where. 6 Firestone Auto Care (Ground Lease) 1313 Harrisburg Pike Columbus, OH 1989 6,707 2/21/2014 $605,900 $90 6. Section 2. chapter 17. , net rental income. Current ‘‘market’’ rent is $20 per square foot on a triple net basis (for leases signed today). Triple net leases are traditionally found in retail and standalone properties. A triple net lease works by a commercial property owner leasing a building or space to a tenant. A triple net lease agreement form is a document used for the leasing of commercial real estate. The net-lease model provides durability and resilience to cash flows, aided in part by. 00 NNN per sqft/year. A lease-leaseback transaction should be accounted for as a net transaction. 50 in 2009, while market rent for triple-net leases is expected to be $14/SF. The owner usually maintains responsibility for repairs, including major and structural repairs. For a lessor, there might be problems with the building falling into disrepair. As the net lease sector continues. However, properties leased on a triple net basis were not eligible to rely on this safe harbor. 3M this accelerated depreciation translates into a first-year tax savings. However, the rental income is specified service income because Partnership B is an SSTB and the two partnerships are commonly owned. A triple net lease, by contrast, is an investment that works for folks with a busy schedule. A single triple net lease does not generally rise to the level of a section 162 trade or business. To reach net zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around $4 trillion. Between AD&D and term life, term life covers more. Dallas-based Spirit Realty Capital Inc. The term “triple net lease” refers to a commercial lease in which the basic rental rate (which is almost always quoted on a per sq ft, per annum basis) is what the landlord “nets” in his pocket. 94 per land square foot. Triple net leases are traditionally found in retail and standalone properties. Why Single Tenant Triple Net Leases Are Perfect for Generating Passive Income. A triple net lease (triple-net or NNN) is a leaseagreement on a property whereby the tenant or lessee promises to pay all the expenses of the property, including real estate taxes, building insurance, and maintenance. AppFolio Property Manager. With the triple net lease agreements, owners can pass on this spending to the tenants. 12 In summary, the April proposed regulations generally take a forgiving approach whereby all rental activities — other than properties rented on a triple - net basis — will. This is also a major pro when considering investing in a triple net lease property, as it provides a steady, predictable revenue stream on a monthly basis. For investors looking to purchase a commercial property with a tenant in-place, this is a key difference, especially if the building is older. Included in the $7,500 per month amount is both the base lease rate and the operating expenses. 4. If they sign an NNN, the tenant accepts responsibility for all property expenses such as:About Triple-Net Leases. Rental real estate activities are found in several of the labyrinth rooms of the Code. Since. Perhaps another post? Reply. Triple Net Cannabis Leases. A sale and triple net leaseback can enable a company to release cash tied up within real estate (whether that be a single asset or a pool of assets; for a single asset class or multiple asset. limited liability and individual tax returns, conducting tax research, performing basis adjustments. On a pro forma basis, coverage for the consolidated portfolio for the twelve-month period ending March 31, 2019 would have increased from 1. Net loss attributable to common stockholders was. In one example, a landlord constructs a building and leases the entire building to a single tenant on a triple net basis whereby the tenant is responsible for all costs relating to the building. These costs are divided into three “Nets. ($1. The net rental income from Partnership A is deemed QBI. Other calculations and variables also affect a triple net investment’s outcome, including the cap rate spread. P. Much progress has been made in elucidating the structure of collagen triple helices and the physicochemical basis for their s. However, properties leased on a triple net basis were not eligible to rely on this safe harbor. The REIT’s portfolio includes more than 80 dollar stores. To determine the triple net lease amount for each renter, add those monthly expenses and the monthly rental per square foot charges and multiply it by the number of square feet a renter is leasing. In a Triple Net lease, the tenant is responsible for their proportionate share of property taxes, property insurance, common operating expenses and common area utilities. 82 million basis in 88% of the outstanding stock of Merryvale Corporation. Triple net leases remain in effect regardless of who owns the building. Triple net lease, or NNN lease. Tenant Pays the Operating Expenses. Triple Net (NNN) Lease vs. Many tenants are attracted to NNN leases. A tenant strapped for cash (possibly due to rising insurance and tax rates) might let some of the maintenance slip. A gross lease is like a simplified version of the NNN lease. Net lease requirements are most commonly used. The monthly rent would be: $4,000 base rent +. 25-$3 net of electricity. With some net leases, the tenant may have a variable monthly payment while in other net leases, it is fixed. Under a triple net lease the tenant will be responsible for paying all operating expenses and therefore all increases year to year. According to Garrison Architects, The Seventy-Six is the first "triple net-zero (energy, water and waste) housing development in the United States. S&P Global Ratings expects the COVID-19 pandemic and resulting state government-imposed lockdowns to result in material near-term reductions in rent collections for U. Proc. May 3, 2018 1 min read. Publication date: 31 Jan 2023. As an additional rent expense, it is not intended to be a profit-center for your landlord and makes up one of the three “nets” in triple net (NNN). Triple net (NNN): the tenant pays rent, utilities, property taxes, insurance, and maintenance. According to the company’s third-quarter (October 28, 2021) results, Taco Bells’ same-store sales grew +8% on a 2-year basis. By comparison, a. Commercial real estate is known for its high costs for property tax and building insurance. The Investor Relations website contains information about Nasdaq, Inc. 355 applies, even if the requirements of Sec. In contrast, the landlord can take a hands-off approach while the property is being developed to the tenant’s tastes. After all, you'd rather pay $21 per square foot in rent than $33, right? However, if the $33 lease is a gross one and the $21 is a triple net lease in a building with $13 in CAMs and other expenses, the gross lease is actually less expensive. net lease continues to provide meaningful yield premiums = 75 to 100 basis points wide. The triple net lease is the most-used type of commercial lease for free-standing buildings with a single tenant. NNN stands for Triple Net rent. In general, investing in a triple net commercial property provides tax benefits to the savvy, diversified investor. tenancy at will. Kimco Realty, a large owner of shopping mail retail properties, owns several properties that are leased on a triple-net basis to TJ Maxx and other big box retailers, where the tenant pays property taxes, insurance, and maintenance costs as well ground lease payments. Triple net lease (or “triple-net” or “NNN”) properties have risen in popularity due to their relative stability and high earnings potential. Common basis increases include capital contributions, ordinary income, investment income and gains. However, a NNN amount per year of $10 would yield $10,000 a year. g. original purchase price of $3MM creates a step-up in basis. g. The tenant is responsible for net property taxes, net insurance, and net maintenance for the duration of the lease, which is the origin of the name. Cons: metals w/ unpaired e. CAM caps in triple net leases can be cumulative or compounded (also referred to as non-cumulative), and calculated either year over base or year over year. Most space in suburban two- to three-story office buildings in the San Diego region costs $1. ab initio (Hartree Fock) - Complete Neglect of Differential Overlap. Compare it to other lease types. It is an agreement between the lessee and the lessor. 7. Typically, tenants pay the “net” amount for these three expenses: Property taxes. Calculate your space rental costs for properties quoting Yearly Rates (e. 1. Operating expenses for the property are currently $6 per square foot per year. Therefore, they handle building insurance, property insurance, and real estate taxes on top of paying rent. The $24. Operating expenditures. 00 per square foot modified gross, net of janitorial. Whenever you enter a transaction for your rental,. The single most important principle of wealth management is to preserve one’s capital and protect it from loss. However, in recent years, the triple net lease structure is also finding its way into office and industrial, too. Key takeaways. The grand total is then (8 × 1/8) + (6 × ½) = 4 atoms per unit cell. A Single-Tenant Triple-Net property (also known as “Net-Lease”, “STNL” or “NNN”) refers to a property which is 100 percent leased to one tenant with a lease structure in which the tenant is responsible for all property-related expenses, leaving the landlord with minimal responsibilities. Only the components that are integral to the right to use an underlying asset are considered lease components. Basically, the tenant is paying only for their use of the property. It is a powerful forecasting method that may be used as an alternative to the popular Box-Jenkins ARIMA family of methods. The New Deal was a series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Double Net Lease: An agreement in which the tenant is responsible for both property taxes and premiums for insuring the building. Net-net is a value investing technique developed by Benjamin Graham in which a company is valued based solely on its net current assets. Taxes for any fractional calendar year. Four Corners Property Trust: Bill Lenehan, 415-965-8031 CEO Gerry Morgan, 415-965-8032 CFOThe Benefit of Lower Rent. ; DES has a key size of 56 bits, which is less than AES, which has a secret key size of 128, 192, or 256; AES is comparatively faster than. This means that the lessor remains responsible for insurance, deductibles, and maintenance costs.