Benefits of investing in Triple -Net Properties
One of the most popular property types in commercial real estate are "triple net," also known as "NNN" deals. These are typically single-tenant retail properties leased to tenants with high credit ratings on "net, net, net" terms (hence the NNN acronym), meaning the tenant is responsible for real estate taxes, insurance, and all maintenance.
What is a Triple Net (NNN) Lease?
What exactly is a triple net, or NNN, lease? A triple net (NNN) lease is defined as a lease structure where the tenant is responsible for paying all operating expenses associated with a property. The triple net or NNN lease is considered a “turnkey” investment since the landlord is not responsible for paying any operating expenses. With that said, in order to fully understand the NNN lease you must first understand the spectrum of commercial real estate leases.
When most people talk about a triple net or NNN lease, they are usually thinking about an absolute net lease. However, just because a lease is called or labeled an NNN lease, does not mean it’s actually an absolute net lease. Often a lease will be called a “triple net lease” for convenience when in fact it is not.
Walgreen Drug Store to a dollar store such as Family dollar, Dollar general, Bank building, food such as McDonalds, Burger King or Taco Bell or auto service and part stores like Bridgestone/Firestone or an Advance Auto. NNN properties are typically leased to tenants for a 10 to 25-year term.
There are many advantages investing your money in Triple Net properties there is a tremendous growth in demand from investors on every level. They appeal to part-time investors looking for guaranteed income with no management responsibility, and they provide an attractive exit strategy for those with mature portfolios.