In a percent lease, what is the fixed portion of the rent known as?

In the context of a percent lease, the fixed portion of the rent is referred to as the minimum base rent. This component serves as a guaranteed income stream for the landlord, regardless of the tenant's performance or sales volume. In a percent lease, the total rent is often made up of two parts: the minimum base rent and a percentage of the tenant's sales revenue over a specified threshold. This structure is particularly common in retail, where landlords seek to benefit from the tenant's success while still ensuring a baseline income through the minimum base rent.

The term effectively communicates the dual nature of the lease agreement, wherein the fixed portion provides stability for the landlord while the variable portion rewards both the landlord and tenant as the business grows. This system incentivizes the tenant to increase sales, potentially benefiting both parties in a mutually advantageous arrangement. Other terms like variable rent or fixed rate rent do not precisely capture this concept within the specific context of a percent lease. Each of these terms might describe different rent structures but do not encapsulate the concept of the guaranteed fixed payment that a minimum base rent does.