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Triple Net Lease Pros and Cons | Top 10 Reasons to Invest in Net Lease

Why Invest in the Net Lease Market?

Investors choose to invest in net lease properties for several reasons. Net lease assets offer a reliable source of fixed income with little to no management hassles.  These investments tend to be long term and have investment grade tenants that reduce risk and the often include rent increases, which benefit the investor.  Further, with certain properties, as with other commercial real estate, the property itself may become a generational investment that overtime, due to the location, significantly increases in value on top of the income flow.

Top 10 Reasons to Invest in the Net Lease Market

  1. Passive Income – “Mailbox Money”

    The investor does not need to be actively involved in the management of the property. Net leases are reliable “hands-off” investments.

  2. Increased Property Value

    As the landlord, and depending on the lease, you can negotiate higher rental terms thus increasing the value of your property.

  3. High-Quality/Credit Worthy Tenants

    Most net lease market transactions involve the buying and selling of assets operated by national brand tenants and these tenants usually come with good credit. This means you can count on them to make the rent payment each month. Net leases are often backed by corporate guarantees.

  4. Attractive Financing

    Lenders prefer net lease transactions as they also know these investments creates stable income. In other words, banks know you will be able to repay your loans.

  5. Low Turnover Rate

    Net leases are usually long-term and have multiple options in the lease. This means that you, the investor, does not have to worry about re-tenanting.

  6. Attractive Price Points

    Net leased assets tend to range from under $1M and up. Depending on the location, length of lease, tenant and other factors you can determine what is the best price for you.

  7. Higher Liquidity

    Net lease market advantages are known across the industry. This helps you sell quickly if you need an exit strategy.

  8. Opportunity to conduct a Sale-Leaseback Transaction

    These deals happen when a company owns a building that they currently occupy, but need to sell to raise funds/capital for some part of their business. After the sale, they will lease back the space.

  9. NO management responsibilities

    NNN leases mean no costs or responsibilities fall on the landlord.

  10. Most importantly…STABILITY

    To finish off this list of triple net lease pros and cons…These are stable assets with long-term leases. This guarantees money for you and with low turnover, you are able to plan for the long-term.

Amanda WillisTriple Net Lease Pros and Cons | Top 10 Reasons to Invest in Net Lease

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