Which lease includes a clause that allows periodic increases in rental rates?

• A. Escalated Lease
• B. Index Lease
• C. Reappraisal Lease
• D. Ground Lease

Answer: (A)

Periodic rent increases are handled through an escalation provision in the lease. An escalated lease includes a clause that raises the rent on a set schedule or according to a formula, ensuring rents increase over time to reflect rising costs or inflation. This explicit mechanism for automatic increases makes it the right choice when the question asks about a clause that allows periodic rental-rate increases.

Other lease types operate differently: an index lease adjusts rent based on an external index such as a consumer price index, so increases follow that index rather than a predetermined schedule; a reappraisal lease changes rent after a property appraisal, usually reflecting changes in property value; a ground lease governs the lease of land itself and can have its own terms, but it does not inherently center on periodic increases in rent.