Investments – Getting Started & Next Steps

Triple Net Lease – Maximizing A Landlord’s Investment

Several real estate investors have been detained by the usual concerns of owning a property like expanding occupancy, handling expenses, and all the other related headaches. A triple net lease investment minimizes the work as well the risks associated with every one of these concerns and simplifies the landlord’s job.

There are a range of lease choices being offered in the marketplace these days. The same as financing, investors sometimes must get imaginative when it comes to leases so that they can maximize their investment or facilitate for a deal to materialize.

Aside from the regular kind of lease, you are probably familiar with such as leasing a car, a home or an apartment, there other types of leases that apply to commercial real estate and additionally beneficial to investors, which are termed net leases.

There is the triple net (NNN) lease, double net (NN) lease, and single net (N) lease that forwards some or every variable and fixed expense of keeping up the property to the tenant, in place of the landlord. With these leases, it is the tenant who should be making property payments aside from the rent.

A single net lease makes sure that the renter spend for the real estate taxes besides their rent. With double net leases, the tenant must pay not only the rent and taxes but the insurance as well. This delightful endowment from the lease fairy put on the tenant’s tab the rent, insurance, taxes, and maintenance expenses. Thus, the investor is able to break free of all the costs that are usually associated with property ownership when this agreement is in motion.

Several tenants probably will not agree to a lease system such as the triple net investment. Many point out that having this sort of agreement at work will make it hard for them to predict or calculate their charges. Like if they have to pay for repairs along with maintenance, and subsequently their costs might blow up one month. Contrary to regular leases where tenants will know their fixed rental amount they have to pay at all times, the triple net lease exposes them to costs that are inconsistent and which they are unlikely able to calculate. On the other hand, the triple net lease is not only beneficial to the investor.

A triple net investment can be beneficial to tenants in the form of lower permanent rents. They will find this situation mostly favorable in new buildings. In a recently constructed building, they will be able to benefit from the cheaper rent plus the diminished fees for repair and maintenance, being that the building is new.

Naturally, the triple net lease is most favorable for you as an investor. It liberates you from the various expenses that generally have to be taken out of your income. Not only are investors freed from the financial woes, but from the stress regarding how these costs will be covered, or how the bills are to paid, and more.

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Categories: Financial