A modified gross lease is a commercial lease in which the tenant pays a fixed base rent on a monthly or annual basis, but also agrees to pay a proportional amount of the operating expenses for the property, such as:

• taxes

• property insurance

• utilities

• maintenance and repairs (including structures such as the roof), systems (heating, ventilation, and air conditioning and electrical)

• common area maintenance (CAM) such as maintenance of the parking lot, landscaping, maintenance staff, security staff, and maintenance of elevators and escalators.

There are many variations of modified gross leases, with different expenses reimbursed by the tenant to the landlord, and different methods of calculating the tenant’s proportionate share of the expenses.

In Nebraska, a modified gross lease is a type of commercial lease agreement where the tenant pays a fixed base rent plus a share of the operating expenses for the property. The specific terms of a modified gross lease can vary widely, but typically, the tenant is responsible for a proportional amount of taxes, property insurance, utilities, maintenance and repairs, and common area maintenance (CAM) costs. The exact expenses covered and the methods for calculating the tenant's share are negotiated between the landlord and tenant and should be clearly outlined in the lease agreement. It is important for both parties to carefully review and understand the terms of the lease, including the expense reimbursement clauses, to ensure they are in agreement with the financial responsibilities. As with any contract, it is advisable for tenants and landlords to consult with an attorney to ensure that their rights and interests are adequately protected and that the lease complies with Nebraska state statutes and federal law.