leasing
graduated lease
A lease in which the rent increases (or sometimes decreases) by set amounts at specified intervals during the lease term. It is often used for new businesses that expect income to grow over time. The steps are stated in the lease from the start, unlike an index lease, which adjusts based on an outside economic indicator.
- Exam tip
- Graduated equals predetermined step increases; index equals tied to an economic index; percentage equals based on tenant's sales.
- Example
- A shop's lease sets rent at $2,000 a month in year one, $2,200 in year two, and $2,400 in year three.
Related terms & state variants
Sources
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Last verified: 2026-10-23