Executory cost definition
/What is an Executory Cost?
An executory cost is any expenditure not included in the minimum ongoing payments associated with a lease. These expenditures are usually related to the ongoing maintenance of or operating costs associated with property. Depending on the terms of a lease agreement, the lessee may reimburse the lessor for any executory costs incurred by the lessor, or the lessor may take responsibility for these costs. These costs can be substantial, and so can be a major point of negotiation when entering into a lease contract.
Examples of Executory Costs
Examples of executory costs are common area expenses, property taxes, insurance, repairs, and maintenance expenses.