Understanding Triple Net Leases For Sale


by Dwaine Clarke

May 19, 2017

In commercial real estate, triple net leases for sale are a thriving niche. They are commonly known as NNN lease. Typical examples of triple net leases for sale are franchises, fast food chains, and convenience stores. However, industrial properties and significant office can also fall under this criterion.

Characteristics of Triple Net Leases for Sale

Triple net leases are a good investment opportunity, for it ensures that as the owner you do not have to incur the costs of maintenance, taxes, and insurance. The tenant is bound to take care of every expense during his stay. When you are the owner of a NNN lease, the only thing you have to do is collecting the monthly paycheck. Under the conditions, any repair work is also covered.

The NNN stands for three nets (net, net, net); no wonder another name for it is bond lease, which means, the rent is considered as an interest payment against any fixed bond. Exactly that’s why more and more people are becoming interested in investing in triple net leases for sale.

Investing in NNN for lease means you get depressed yields to investors from regular bank deposits. It is a great way to utilize a portion of your cash pile. Once a deal is settled, the buyer will get an assignment to catch the future rental stream, during the lease period.

Based on the creditworthiness of the tenant, triple net leases are sold on a cap rate. The cap rate is the exact capitalized rate of return per annum. If the tenant has a formidable credit rating, the cap rate, as expected, will be lower. And when the cap rate plunges, the price obviously rises.

The minimum lease term for a triple net lease is 10 years or more. There also remains the opportunity for multiple renewals. By investing in triple net leases for sale, you can expect an income higher than that is of a deposit or certificate at a bank.

About the author 

Dwaine is the Founder and President of NNN Deal Finder an investment real estate services firm exclusively focusing on Single and Multi-Tenant Net Lease Properties. The firm provides a full range of brokerage and advisory services nationwide to High Net worth Investors, Developers, REITs and Institutional Investment Funds.
Contact Dwaine to discuss securing your next investment.

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