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
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.
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 them.
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 the location.
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 equity.
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
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.
properties 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) investment
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 internationally
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 Triple Net Investment
Group 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
Eleven Advance Auto Parts Applebee's, 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 Box JC Penney Jiffy Lube Key Bank KFC Kindercare KmartKohl's Lowe'sMcDonald Nordstrom Office Depot Office Max Olive Garden Pep Boys PetSmart Pizza Hut PNC
Bank Popeyes Radio Shack RBC Bank Regal Rite Aid Ross Stores Ruby
Tuesdays Safeway Sears Staples Starbucks Shell Oil Taco 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 results.