What are Single Tenant Net Lease Properties and What are the Benefits
A single-tenant net lease property refers to a commercial real estate property that is leased to a single tenant under a net lease agreement. In this type of lease arrangement, the tenant typically assumes responsibility for paying not only the base rent but also a portion or all of the property’s operating expenses, such as property taxes, insurance, and maintenance costs.
Single tenant: These properties are occupied by a single tenant, usually a business or corporation, as opposed to multiple tenants or a mix of businesses.
Net lease: Net lease agreements shift the responsibility of certain costs from the landlord to the tenant. These costs often include property taxes, insurance, and maintenance expenses. The tenant pays these costs in addition to the base rent.
Long-term leases: Single-tenant net lease properties typically involve long-term lease agreements. The leases can range from 5 to 20 years or even longer, providing a stable and predictable income stream for the property owner.
Triple Net (NNN) leases: Single tenant net lease properties are often structured as triple net leases (NNN leases). In addition to paying the base rent, the tenant is responsible for all property-related expenses, including real estate taxes, insurance, and maintenance costs.
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