Which lease type requires the property owner to cover all operating expenses?

The lease type that requires the property owner to cover all operating expenses is the gross lease. In a gross lease, the tenant pays a fixed rent amount, and the property owner is responsible for all operating expenses, including property taxes, insurance, and maintenance costs. This arrangement simplifies the payment process for tenants, who do not have to worry about variable operating expenses, making it a common choice for residential leases and some commercial leases.

In contrast, a net lease typically shifts some or all of the operating expenses to the tenant. A triple net lease is an even more specific arrangement where the tenant is responsible for property taxes, insurance, and maintenance, in addition to the rent. A modified gross lease falls somewhere in between, where the tenant may cover some expenses while the owner covers others. These distinctions clarify why the correct answer emphasizes the gross lease's characteristic of placing the financial responsibility for operating expenses solely on the property owner.