Once you find a site you are interested in, the price of the site is usually shown in one of two forms:
1) Price NNN (pronounced Triple Net)
2) MG (Modified Gross)
Essentially, NNN, stands for net, net, net, and has an N representing three expenses that the Landlord needs to pay, these are called past throughs, since the Landlord doesn't profit on these expenses. most commonly NNN are:
N- Property Taxes
N- Fire Insurance on the building (not your personal space)
N- CAM (Common Area Maintenance) such as gardening, garbage pick up, electricity in the parking lot, and sometimes, but not always water as well.
The above expenses are added up to their total amount, then divided by the total Square Footage of the shopping center, then dispersed evenly between the Tenants of the property according to the Square feet each Tenant will be leasing.
So if the NNN for a property is $0.50, and Tenant X is leasing 800 Square Feet, he would be paying:
$0.50 x 800 SF = $400 per month.
If another Tenant is leasing 1,500 Square Feet, he would be paying $750.00 per month.
The actual NNN are not negotiable (unless the Landlord is so desperate that he really wants you in his center, and he will share the costs of the NNN with you, but this doesn't happen very frequently) also, Landlord's always have an administration fee attached to the NNN costs, which can be negotiated down. Each Tenant in a NNN lease will pay the NNN price amount per the amount of square footage that is leased. It is recommended to place a CAP amount for how much NNN charges can increase. Also, usually the Landlord will allow you, the Tenant, once a year to look at his books to confirm that these are the real prices that he, the Landlord is paying.
Now lets incorporate the NNN charges into the price of the rent. For example, if a space is 1,500 SF. and the agreed upon price for the space is $3.50 per square foot on a monthly basis (or $42.00 per square foot annually) and the NNN charges are $0.90 (or $10.80 annually) per square foot, the price of the space will be:
$3.50 + $0.90 = $4.40 Per Month
Rent + NNN
$4.40 X 1,500 SF = $6,600 per month.
Hope this explanation helps the reader understand what NNN are and how they work.