Absolute Triple Net
Types of net leases
There are standard names in the commercial
real estate industry for different sets of costs passed on to the tenant in a net lease. Double and triple-net
leases are more common forms of net leases.
Single net lease
In a single net
lease (sometimes shortened to Net or N), the lessee or tenant is responsible for paying property taxes as
well as the base rent.
Double net lease
In a double net
lease (Net-Net or NN) the lessee or tenant is responsible for property tax and building insurance. The
lessor or landlord is responsible for any expenses incurred for structural repairs and common area maintenance.
"Roof and structure" is sometimes calculated as a reserve amount, which the tenant must pay.
Triple net lease
A triple net
lease (Net-Net-Net or NNN) is a lease agreement on a property where the tenant or lessee agrees to pay all
real estate taxes, building insurance, and maintenance on the property. In such a lease, the tenant or lessee is
responsible for all costs associated with the repair and maintenance of any common area. This form of lease is most
frequently used for commercial freestanding buildings. However, it has also been used in single family residential
rental real estate properties.
Bondable lease (Absolute
A bondable lease (also
called an "absolute triple net lease", "true triple net lease", or a "hell-or-high-water lease") is the most
extreme variation of a triple net lease, where the tenant carries every imaginable real estate risk related to the
property. Notably, these additional risks include the obligations to rebuild after a casualty, regardless of the
adequacy of insurance proceeds, and to pay rent after partial or full condemnation. These leases are not terminable
by the tenant, nor is it permissible for rent to be abated under
The concept is to make the rent absolutely
net under all circumstances, equivalent to the obligations of a bond. An example of
this type of lease would be a leaseback arrangement
in which a retailer leases back the building it formerly owned and continues to run the operate its business at
Typically, triple net leases (NNN) are
'equity investments', rather than 'cash flow investments'. For example, the investor will finance a significant
portion of the purchase price on a property and pay the resulting mortgage with the lessee's monthly owed rent.
There is usually a small amount left over as monthly profit for the investor (positive cash flow), but the greater
investment payoff comes from the tax shields afforded
to the investor through the use of leverage. The resulting property is then sold after a period of building up
Why Net Leased Single Tenant
Properties for Investments?
Investors buy net leased single tenant
properties for a variety of reasons such as no management responsibilities, a long-term lease, credit- worthy
high quality tenant, stable cash flow, attractive financing,
equity growth, unique
tax benefits and good capital gains.
Triple net lease
commercial investments are like corporate bonds and areknown to be one of the safest and the most solid
investments with dependable incomein commercial real estate. The investor in corporate NNN property, not only
benefits from the higher yields than bonds or CDs, but also benefits from dependable steady long term
, and unique tax incentives such as 1031
exchange in case of the sale, depreciation on improvments and more.
offer the benefit of little orno management responsibilities, as the tenant pays for most, if not all, of the
expenses according to the terms of the lease. In Triple Net, (NNN) or (Net Net Net) lease tenant pays for the net
of taxes, the net of insurance, and the net of maintenance.
are typically leased to a single tenant
business for a long term, often 10-25 years. Therefore banks due to minimal risk of investments are motivated
to provide very attractive financing. Due to a long term lease, Triple net leased tenants generally have
a vested business interest to make sure that a location is well maintained and is attractive for all
customers. They frequently make significant property improvements at their own expense to enhance the real
estate over time in order to be more successful with their customers.
things should I know before investing in any NNN properties?
1) Market Feasibility,
Does the forecasted supply and demand
relationship for the property in the selected location indicate success?
2) Location and Site Feasibility,
Will the location and site support the
3) Financial Feasibility,
Does the projected financial picture
indicate sufficient profit with the risk?
Main factors in pricing triple net (NNN)
A) The financial strength of the guarantor of the lease
B) The specific location of the property under consideration
C) The remaining length of the lease term and the periodic increases in the lease
D) The financial performance of the specific property under consideration
We strive hard to provide clients with quality costumer service
We provide our clients with all of the
information they need upfront to make an informed decision, even before a Letter of Intent is issued such as:
tenant credit information, store sales, lease terms, options, renewal rates, rent escalations, location analysis,
site analysis, market analysis, demographic data, cash on cash returns on investment, internal rate of returns
after taxes, risks, likes, dislikes and so on. We will then strategies how to proceed on making a best offer. It is
our goal to build a solid relationship with our clients and keep them updated on net lease investments, even though
they may not have a need for years to come.
We market our listings locally, nationally and
Triple Net Investment Group difference is a
concept that is revolutionary in the commercial real estate brokerage business. In addition to marketing our deals
to potential investors, We markets our listings to the entire brokerage community. We put our listings directly in
front of thousands of commercial real estate agents in each state, region and local where the property is
Are you looking
for a specific location or NNN tenant?
At nnndeals.com We pride ourselves in
excellent client service. We have access to an extensive inventory of triple net single tenant properties
for sale and contacts to find you exactly what you are looking for such as:
Eleven Advance Auto
AT Autozone Bank of
America BB Best Buy Bed Bath &
Beyond Blockbuster BP Burger King Chase
Bank Chevron Chili's Citibank Costco CVS Dollar
General DaVitaExxon Mobil FedEx Food Lion Foot
Locker Gap Goodyear Home
Depot Jack in the
Bank KFC Kindercare KmartKohl's Lowe'sMcDonald Nordstrom Office
Boys PetSmart Pizza
Bank Popeyes Radio Shack RBC
Bank Regal Rite Aid Ross
Tuesdays Safeway Sears Staples Starbucks Shell
Bell Target T-Mobile Verizon Wachovia Walgreen Wal-Mart Wells
Fargo Wendy's Whole Foods,
Please contact us
if you are buying or selling a net leased property. We get