In which type of lease does a portion of the tenant's gross sales constitute the rental payment?

A percentage lease is a type of lease agreement in which the rental payment is based on a percentage of the tenant's gross sales. This arrangement is commonly used in retail settings, where a landlord may ask for a percentage of sales in addition to a base rent, allowing the landlord to benefit from the tenant's success. This type of lease aligns the interests of both parties—if the tenant's sales increase, so does the landlord's income.

In contrast, a graduated lease involves rental payments that increase at specified intervals, which do not depend on sales performance. A short-term lease generally refers to leases that are for a brief period of time, typically not linked to performance metrics. A net lease creates a rental agreement where the tenant pays not only rent but also some or all of the property expenses, such as property taxes, insurance, and maintenance costs, but again, these do not involve gross sales figures.

Thus, the defining characteristic of a percentage lease is its direct connection to the tenant's revenue, making it unique among lease types.