Gross vs Net Rental FAQ

admin November 18, 2015

Tony Galetti of Galetti Knight Frank property brokers in South Africa explains the differences between the terms “Gross Rentals” and “Net Rentals” in the context of the commercial property market.

This video is the latest edition of the Galetti Knight Frank Frequently Asked Questions (FAQ) series. According to Tony, Gross Rental is the total rent payable by a tenant, whereas Net Rental is the tenant’s rental portion that excludes their contribution to costs. These excluded costs could comprise of fees for rates, security and more, depending on the building in question.

Tony says that it is important to be aware of this when considering renting a property and having a rental amount quoted to you. It is also imperative to keep costs in mind, thus if your business will use a lot of water or electricity over and above your gross rental, that too will be for your own account. Finally, Value Added Tax (VAT) will be attached onto your Gross Rental.