Busi 331 Answer Guide 3 Lesson 3: Introduction To Leasing

This study source was downloaded by 100000868590658 from CourseHero.com on 06-15-2023 01:01:44 GMT -05:00https://www.coursehero.com/file/69153403/Assignment-3-Anspdf/ UBC Real Estate Division 2019 BUSI 331 Answer Guide 3 LESSON 3: Introduction to Leasing 1. Answer: 1 Situation A illustrates an escalator clause where the Delicious Hamburger House Restaurant must pay the increase in taxes and/or operating expenses above the base year. The other statements are false. Situation B illustrates a sublease where Pete and Walt are the sublessors and Terry is the sublessee. Situation C is not an example of a net lease. It is an example of a percentage lease where the tenant is required to pay a specified percentage of gross or net sales made upon the premises. A net lease is a lease where the tenant pays a base rent plus their pro rata share of the property taxes, utilities, heating, repairs, maintenance costs, etc. Situation D illustrates a gro ss lease where the owner or lessor pays the taxes, insurance, maintenance, services, operating costs, etc. 2. Answer: 4 Option (4) is false. Rent can be paid at any time on the day it is due; it is not in arrears until after midnight. 3. Answer: 1 Option (1) is false.