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. Triple net lease investments reduces the work load and risks correlated with these concerns and makes the task simpler for the landlord.
Today, there is an array of lease opportunities that the marketplace has to offer. As with financing, investors likewise have to use their imagination occasionally, so as to take full advantage of their investments or even bring about a deal.
Besides the usual lease type that you perhaps know from leasing a house to an apartment and a car, there is a variety of leases which are normal and from which a commercial real estate investor can enjoy more benefits, and these are referred to as 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.
The single net leases insure that the lessee pays the taxes on real estate on top of the rent. Double net leases pass to the tenant the burden of paying the taxes as well with insurance on top of the rent. Such magical present granted by the lease fairy makes tenants pay for rents, taxes, insurance, as well maintenance. 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. Most of them speak of the difficulty they might encounter in terms of calculating or predicting their costs if such an agreement is enforced. 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. However, such triple net lease investment does not benefit investors alone.
Tenants covered by the triple net lease will benefit from reduced fixed rents. They will find this situation mostly favorable in new buildings. There, they will get to enjoy the reduced rent along with little maintenance as well repair costs because of the age of the building.
If you are an investor, a he triple net lease certainly serves your interest the best. 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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