lease

noun
\ˈlēs \

Definition of lease 

(Entry 1 of 2)

1 : a contract by which one conveys real estate, equipment, or facilities for a specified term and for a specified rent took out a five-year lease on the house also : the act of such conveyance or the term for which it is made

2 : a piece of land or property that is leased

3 : a continuance or opportunity for continuance a new lease on life

lease

verb
leased; leasing

Definition of lease (Entry 2 of 2)

transitive verb

1 : to grant by lease

2 : to hold under a lease

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Other Words from lease

Verb

leasable \ˈlē-sə-bəl \ adjective

Synonyms for lease

Synonyms: Verb

charter, engage, hire, rent

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Verb

hire, let, lease, rent, charter mean to engage or grant for use at a price. hire and let, strictly speaking, are complementary terms, hire implying the act of engaging or taking for use and let the granting of use. we hired a car for the summer decided to let the cottage to a young couple lease strictly implies a letting under the terms of a contract but is often applied to hiring on a lease. the diplomat leased an apartment for a year rent stresses the payment of money for the full use of property and may imply either hiring or letting. instead of buying a house, they decided to rent will not rent to families with children charter applies to the hiring or letting of a vehicle usually for exclusive use. charter a bus to go to the game

Examples of lease in a Sentence

Noun

They took out a five-year lease on the house. We hold leases on both of our cars.

Verb

She leases a red convertible. I have leased this house for the last four years. We leased the house to a young married couple.
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Recent Examples on the Web: Noun

That figure includes 700,000 acres of new leases on public land in and around the Greater Little Mountain area, south of Rock Springs. Story Hinckley, The Christian Science Monitor, "Group effort rules the roost in Wyoming, then Washington intervenes," 10 July 2018 Like Rihanna, the photos of Jay are relative throwbacks (High Snobiety, has speculated they’ve been taken in 2016), but have gotten a new lease on life, thanks to a fresh batch of memes that the Internet has cooked up using the photos. Cady Lang, Time, "Jay Z on a Jet Ski Is the Meme We All Deserve This Summer," 9 July 2018 And with former Napoli manager Maurizio Sarri waiting in the wings if Conte is indeed sacked, Loftus-Cheek could be given a new lease of life at Stamford Bridge next season. SI.com, "Crystal Palace Handed Boost in Chase for Chelsea and England Star as New Season Approaches," 6 July 2018 All this has given outsourcing a new lease of life. The Economist, "Run, TaskRabbit, run: July 2030," 5 July 2018 This is an existing white elephant getting a new lease on life, if only briefly as an imposing backdrop. Washington Post, "Unused Soviet-era office block looms over World Cup fans," 28 June 2018 Webley Adler Leonardo Tamburri Pack Light and Embrace Danger MC beauty director Jennifer Goldstein’s near-death experience gave her a new lease on life. Jen Ortiz, Marie Claire, "The Ultimate Guide to Getting Away," 25 June 2018 Crédit Agricole has signed a new 7,324-square-foot office lease at Enterprise Plaza, 1100 Louisiana. Katherine Feser, Houston Chronicle, "Real estate briefs: Crédit Agricole, EaDo Storage, Pioneer Exploration ink deals," 14 June 2018 Valor, a 3-year-old blue heeler, has a new stick and a new lease on life in Austin, Texas. Matthew Martinez, star-telegram, "This pooch was euthanized and 'discarded' — but then he woke up, Texas shelter says," 14 June 2018

Recent Examples on the Web: Verb

The demolition, which is expected to cost $20,000 to $30,000, will happen after the town leases the property to Eversource for six months at a cost of $1,750 a month while the utility works on upgrading its grid. Steven Goode, Courant Community, "Riley Lumber Property Purchase In Sight," 14 July 2018 Amazon alone accounted for a tenth of all of the space in U.K. warehouses leased last year, according to data compiled by Savills Plc. Fortune, "This Is London's Hottest Property — Thanks to Amazon," 13 July 2018 Founded in 1985, Envirotainer manufactures and leases cold containers used to ship pharmaceuticals products. Joice Alves, WSJ, "Cinven Purchase Values Envirotainer at Over €1 Billion," 12 July 2018 Michael Pegues, Aurora’s chief information technology officer, said there is no specific proposal for leasing the poles yet. Steve Lord, Aurora Beacon-News, "Aurora council wants more study of using ComEd poles to expand fiber optic network," 11 July 2018 Another Way businesses, Schoolhouse Gilbert South, leases a Gilbert elementary school to American Leadership for $1.12 million a year, records show. Craig Harris, azcentral, "Arizona charter school founder makes millions building his own schools," 11 July 2018 But Watershed board President Jessie Lehson said the school can’t lease a facility or borrow money from a bank without the charter. Liz Bowie, baltimoresun.com, "Proposed Baltimore County charter school takes application fight to state officials," 10 July 2018 JetBlue’s E190s — 30 owned by the airline and 30 leased — will be phased out gradually through 2025. Christopher Jasper, The Seattle Times, "JetBlue places big order for newest Airbus A220 jet," 10 July 2018 The merchants will be a mix of food vendors, clothing stores and service providers, said Deborah Kravitz, president of PRI, who is handling leasing with those retailers. Roland Li, SFChronicle.com, "Philz Coffee, gym could open in new SF transit center," 9 July 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'lease.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of lease

Noun

14th century, in the meaning defined at sense 1

Verb

circa 1570, in the meaning defined at sense 1

History and Etymology for lease

Noun

Middle English les, from Anglo-French, from lesser

Verb

Anglo-French lesser, laisser, lescher to leave, hand over, lease, from Latin laxare to loosen, from laxus slack — more at slack

Noun

Anglo-French les, from lesser to grant by lease, from Old French laisser to let go, from Latin laxare to loosen, from laxus slack

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Phrases Related to lease

a new lease on life

Statistics for lease

Last Updated

18 Oct 2018

Look-up Popularity

Time Traveler for lease

The first known use of lease was in the 14th century

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More Definitions for lease

lease

noun

Financial Definition of lease

What It Is

A lease is an agreement, usually in writing, between the owner of an asset and a lessee.

How It Works

Leases can be for a variety of assets, though real estate often comes to mind first. For example, let's say John Doe owns a house on Main Street. He does not live in the house; he decides to lease it to Jane Smith. John continues to be the owner of the house, but Jane agrees to pay John $800 a month in return for letting her live there for a year. They type up a lease, which sets forth the exact dates Jane can live in the home, what improvements or changes Jane is allowed to make to the home, and what happens if Jane damages the home.

Leases can also be for cars, manufacturing equipment, office space, photocopiers, musical instruments, solar panels, or virtually any other asset. Generally, leases are handy when one party has the capital to purchase the asset and another party does not have the capital to do so but would like access to the asset.

Why It Matters

There are many kinds of leases. Some allow the lessee to buy the asset at the end of the lease term, some do not, for example. Regardless, a lease is a legal contract, and violating a lease can result in monetary damages or other remedy by a court. Generally speaking, leases set forth the lease dates, the payments required, and guarantees that the lessor actually owns the asset that he or she is leasing to the lessee.

Accounting for leases can be complicated. There are two general types: operating leases and capital leases. An operating lease is simply a lease on an asset that does not give the lessee rights similar to those of an owner of the asset. Generally, lease payments made under a capital lease go on the income statement and thus reduce profits.

A capital lease is the opposite—it gives the lessee rights similar to those of an owner of the asset. Generally, lease payments made under a capital lease are recorded on the balance sheet and thus do not reduce profits.

GAAP rules state that to determine whether the lease is an operating lease, the lease must not have any of these characteristics:

1The life of the lease must not be longer than 75% of the life of the asset.
2The lessor cannot transfer ownership of the asset to the lessee at the end of the lease term.
3There cannot be an option to purchase the asset at a "bargain price" at the end of the lease term.
4The present value of the lease payments cannot exceed 90% of the fair market value of the asset.

Source: Investing Answers

operating lease

noun

Financial Definition of operating lease

What It Is

An operating lease is simply a lease that does not give the lessee rights similar to those of an owner of the asset.

How It Works

Let's assume Company XYZ needs a widget machine for its factory. The widget machine costs $1,000,000 to buy, but Company XYZ could also lease the widget machine for $2,000 a month instead. This certainly could preserve a considerable amount of cash for the company. If Company XYZ enters into an operating lease for the asset, it also will not assume any of the risks of ownership by leasing the machine rather than buying it. However, it will have to record all of the lease payments on its income statement (thereby reducing its net income) rather that placing the asset on its balance sheet and recognizing only depreciation on the income statement.

Why It Matters

The buy-versus-lease question is one of the most common in the business world. There are considerable tax and income advantages and disadvantages on both sides, as there are for the operating-versus-capital lease decision.

The payments on an operating lease must be expensed, meaning the lease payments must be recorded on the income statement and thus reduce net income. The asset does not appear on the lessee's balance sheet in an operating lease. This is a different accounting treatment than what would be the case for a capital lease, whereby the lessee enjoys rights that are usually only reserved for someone who actually owns the asset (in that case, the lease payments are capitalized, meaning they appear on the balance sheet instead and thus do not affect net income).

There is certainly the temptation to structure a lease contract such that Company XYZ's lease payments are essentially a series of installments toward the purchase of the asset over time, thereby making Company XYZ the owner at the end of the lease term. But GAAP rules see through most schemes to make asset purchases look like leases. Thus, GAAP rules state that to determine whether the lease is an operating lease, the lease must not have any of these characteristics:

1The life of the lease must not be longer than 75% of the life of the asset.
2The lessor cannot transfer ownership of the asset to the lessee at the end of the lease term.
3There cannot be an option to purchase the asset at a "bargain price" at the end of the lease term.
4The present value of the lease payments cannot exceed 90% of the fair market value of the asset.

Source: Investing Answers

lease

noun

English Language Learners Definition of lease

 (Entry 1 of 2)

: a legal agreement that lets someone use a car, house, etc., for a period of time in return for payment

lease

verb

English Language Learners Definition of lease (Entry 2 of 2)

: to use (something) for a period of time in return for payment

: to allow someone to use (something) for a period of time in return for payment

lease

noun
\ˈlēs \

Kids Definition of lease

 (Entry 1 of 2)

1 : an agreement by which a person exchanges property (as a car or house) for a period of time in return for payment or services

2 : a piece of property that is leased

lease

verb
leased; leasing

Kids Definition of lease (Entry 2 of 2)

: to give or get the use of (property) in return for payment or services

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lease

noun
\ˈlēs \

Legal Definition of lease 

(Entry 1 of 2)

1a : a contract by which an owner of property conveys exclusive possession, control, use, or enjoyment of it for a specified rent and a specified term after which the property reverts to the owner also : the act of such conveyance or the term for which it is made — see also sublease — compare easement, license, security interest at interest sense 1, tenancy

Note: Article 2A of the Uniform Commercial Code, which governs leases where adopted, defines lease as “a transfer of the right to possession and use of goods for a term in return for consideration.”

building lease

: ground lease in this entry

consumer lease

: a lease made by a lessor regularly engaged in the selling or leasing of a product to a lessee who is leasing the product primarily for his or her personal or household use

finance lease

: a lease in which the lessor acquires goods from a supplier in accordance with the specifications of the lessee

Note: Under section 2A-103 of the Uniform Commercial Code, before the lessor signs the lease or the lease becomes effective, the lessee must receive a copy of or approve of the contract by which the goods were acquired or must receive a statement of terms (as warranties, disclaimers, and liquidated damages) relating to the contract or notification of where such information can be obtained.

ground lease

: a lease of land usually for a long term in consideration of the payment of rent and with the agreement that the lessee build or improve a structure on the land

called also building lease

mineral lease

: a lease granting the right to work a mine and extract the minerals or other valuable deposits from it under prescribed conditions (as of time, price, or royalties)

called also mining lease

net lease

: a lease requiring the lessee to assume all operation expenses (as for maintenance, insurance, and taxes) in addition to the payment of rent

operating lease

: a lease of property and especially equipment for a term which is shorter than the property's useful life and in which the lessor is responsible for certain expenses (as taxes)

perpetual lease \pər-ˈpe-chu̇-wəl- \

: a lease renewable forever at the lessee's option

proprietary lease

: a lease used to convey to a member of a cooperative the exclusive possession of a residential unit

true lease

: a lease that resembles a security agreement but retains the attributes of a lease

b : property and especially real property that is leased

2 in the civil law of Louisiana : a contract by which a person provides labor or services for a price

lease

verb
leased; leasing

Legal Definition of lease (Entry 2 of 2)

transitive verb

1 : to grant by lease to another leases mopeds to tourists

2 : to hold under a lease a company leasing a fleet of cars for its executives

intransitive verb

1 : to be under a lease or subject to a lease the vacation house leases for $500 a week

2 : to grant property by a lease have leased to students in the past

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