Gross rent consists of the actual rent (usually net basic rent) plus operating costs incurred and any surcharges. The German terms for “gross rent including heating” and “gross basic rent” are often used synonymously with this. However, there are clear differences. In gross rent including heating, operating costs are covered by payment of the agreed gross rent including heating. There is no regular billing of operating costs; hence the landlord can also not demand the subsequent payment of operating costs by the tenant. At the same time, the tenant is also not entitled to the disbursement of operating cost credit.1
Gross basic rent comprises rent and all operating costs in accordance with the Betriebskostenverordnung (German Operating Costs Ordinance), except heating and warm water costs (“cold operating costs“).2 This form is common in practice for both commercial and residential leases on account of the Heizkostenverordnung (German Heating Costs Ordinance) of 20 January 1989, whereby heating and warm water costs are billed according to measured consumption.3 Gross rent including heating is now only used in exceptional cases (e.g. boarding houses).
Gross rent including heating poses landlords the challenge that a straightforward isolated adjustment of operating costs is not possible. Rather, the landlord must increase the overall gross rent and in doing so comply with the statutory provisions on rent increases. However, as these are predominantly based on net basic rents (rent not including operating costs), rent adjustments can only be implemented to a very limited extent.4
In practice, gross rent including heating is rarely used owing to the difficulties in adjusting rent, hence a net basic rent and an advance on operating costs are usually agreed.
In legal practice the terms “charge” or “rent” are usually used. There is no clear or uniform distinction between the terms.5 In property industry practice, different terms are therefore often used synonymously for gross rent. The following differences should be noted: