Escalation Clause

A clause in a lease providing for increased rent at a future time. May be accomplished by several means such as (1) Fixed increase – A provision that calls for a definite, periodic rental increase; (2) Cost of living – A  clause that ties the rent to a government cost of living index, with periodic adjustments as the index changes; or (3) Direct expense – Rent adjustments based on changes in expenses paid by the landlord, such as tax increases,  increased maintenance costs, etc.