PSI Virginia Real Estate Practice Exam

In a full service lease, what does the rent typically cover?

1. Only the base rent

2. Rent and utilities only

3. All occupancy expenses

4. Maintenance fees only

The correct answer is: All occupancy expenses

In a full-service lease, the rent typically encompasses all occupancy expenses, which means that it covers not just the base rent but also additional costs such as utilities, maintenance, property taxes, janitorial services, and insurance. This type of lease arrangement is designed to simplify the leasing process for tenants by providing a single, inclusive monthly payment, rather than requiring tenants to manage and pay for each separate expense individually. This structure is particularly common in commercial real estate, where tenants benefit from knowing their total occupancy costs up front. It allows businesses to better budget their expenses without the unpredictability of fluctuating utility costs or surprise maintenance bills. By providing a comprehensive coverage of occupancy expenses, a full-service lease offers convenience and predictability for tenants, making it an appealing option for many.