About Single Tenant Net Lease Property Investments
When putting money into a property, investors often want to know what their chances of a profitable return are, especially in a single tenant Virginia property. A professional at Calkain can help you evaluate the reliability of your investment options. Choosing to invest in Virginia single tenant net lease real estate has become increasingly popular. Here we have covered the reasons why this type of investment may be right for you, in addition to comparing single tenant and multi-tenant properties, and more.
Definition of a Net Lease
A net lease is a contract agreement between both tenant and landlord where the tenant is in charge of handling rent payments, repairs, expenses, insurance premiums and utilities.
Difference Between Single Tenant and Multi-Tenant Real Estate
Property with more than one tenant is considered to be multi-tenant real estate. With multi-tenant buildings, landlords and owners may have to balance various leases that can start and end at differing times. Multi-tenant realty can be at risk for being affected by fluctuations in the market, as leases are often less than ten years.
Benefits of Single Tenant Realty in Virginia
Investors can benefit from investing in a single tenant property because it can require much less time and commitment. It can be a great option for those who are looking for a way to increase their real estate portfolio but do not necessarily have additional time to commit. Investors appeal to the idea of contributing to single tenant property because there can be less of a risk, more consistent return, and stability.
What are the factors for how a single tenant asset is valued?
More traditional investments in real estate determine an asset value solely based on the property. A single tenant asset value is decided based on a number of factors, including the following:
- Tenants level of credit
- Duration of lease
- Rental increases during contract term
- Real estate value on its own
When is the most beneficial time to invest in a single tenant property?
Consider net-lease properties to be an investment that can provide a reliable return all year round. Single tenant investments can be stable regardless of the condition of the economy. As an investor of a single tenant property in Virginia, you know which tenant is in the building, exactly how long they are going to be in occupancy and the rate of rent. You can receive a pre-calculated return on your investment, so long as the tenant upkeeps their agreements in the lease contract.
Risks of Single Tenant Property
Overall, single tenant properties have fewer risks than other investments. However, tenants that have lower credit profiles can be a higher risk when it comes to investments. However, this does not necessarily mean the tenant will fail due to having below than average credit. This person may surprise you and prove to be a responsible and reliable tenant.
If you have any questions about the above information or are interested in speaking with a professional at Calkain about net-lease investments, we can be reached to schedule your appointment. The more knowledge you have about your options for investments, the more empowered and confident you can be when choosing your single tenant Virginia properties.Single Tenant Virginia