If you have invested in property and want to rent it out, you may want to consider a lease type NNN. With this type of lease, the tenants are responsible for paying for insurance, taxes and building maintenance. At Calkain, we focus on single tenant net lease investment services and want to help our clients make good investments.
Benefits of a Triple Net Lease
Investing in a NNN lease property can be quite profitable if you do it correctly. Let’s take a closer look at some of the benefits of a triple net lease:
- Less Responsibility: If you have a triple net property, the tenants must take care of all building maintenance. Whether it’s a leaking toilet or broken window, they are responsible for repairing the issues themselves. That means you won’t receive a call every time there is a problem inside the building. You will have less responsibility and have more time to do other things.
- Consistent Cash Flow: Because a lease type NNN is normally at least 10 years, you will have consistent cash flow for quite some time. Unlike traditional leases, you won’t have to worry about finding new tenants every year and having your building vacant for months at a time.
- Fewer Expenses: Investing in a triple net property can also help you save money, which is always a good thing. Tenants have to cover the costs of property taxes, insurance, and building repair costs. If you don’t have all of these expenses on your plate, you could potentially save thousands of dollars every year.
- More Affordable Entry Point: Another advantage of investing in a property with a lease type NNN is that it is less costly than investing in other properties.
- Better Financing Options: Triple net properties are typically stable, so banks may offer more favorable financing options. For example, a bank may offer you lower interests rates and a more affordable down payment.
Tips for Investing in Triple Net Properties
If you have decided to invest in a lease type NNN, follow these tips:
- Consider the Location: Before you invest in a triple net property, you should look at where the building is located. Are you familiar with the market? Do you know what kind of people live in the area and the projected population growth? The more familiar you are with the location and market, the more success you may have with your investment.
- Check Each Prospective Tenant’s Credit: It may be a wise idea to thoroughly look into a tenant’s credit history before renting your property to him or her. A tenant’s credit may give you a good idea of whether or not he or she will be able to pay the rent on time.
- Consider the Financial Performance of Tenant’s Business: Whether the tenant who wants to rent your property owns a clothing store or bakery, you should find out how the business is doing financially. If a tenant’s business it thriving, he or she may be more likely to renew the lease.
If you want to learn more information about a lease type NNN, contact Calkain at 813-282-6000.Lease Type NNN