Triple net properties are some of the worthiest real estate investments to consider! Here’s why:
First, what is a triple net lease?
Also referred to as NNN leases, triple net leases make the tenant responsible for rent, property taxes, and building maintenance. That means that the property owner does not play a significant part in the active management of the property. As an investor, it also means that you do not have a high risk of not receiving rent payment if the tenant’s business collapses.
Some of the perks of triple net lease properties include:
- Stable cash flow
As mentioned above, triple net properties offer you a stable cash flow. Remember, these leases are long-term. And this guarantees you a positive cash flow for a long time. As an investor, you do not have to worry about finding new tenants or having your building vacant for some time.
- Minimal management
Investors who choose to consider the triple net lease can enjoy the luxury of minimal management. The reason is for this is that the tenant takes the responsibility of dealing with matters on insurance premiums and deductibles, maintenance, and property taxes, besides the monthly rent.
As a busy investor, that lifts off the heavy burden of keeping up with varying expenses. And this allows you to focus on other essential aspects of your life.
- Low entry price point
Another perk of triple net properties is that they are more affordable compared to most property types. That means that you can buy property at affordable rates, get a tenant and begin earning money.
Since not all triple net properties offer the same type of investment opportunity, you need to understand their downsides so you can choose the right option for your investment portfolio.
Some of the tips that will help you make a wise decision when investing in NNN properties include:
- Settling for ideal triple net leases locations
Location plays a crucial role in NNN property value since it determines how successful your investment will turn out to be in the long run. You need to assess the potential in the current location of the building and its viability.
Remember, the best triple net properties have accessible locations. And good traffic. That means that customers can access these areas. And this means tenants of you.
You also need to study the geographical location of the NNN property. You want to invest in areas that have high growth rates and a steady population. That means a significant pool of customers, hence tenants that aim to establish their businesses in your property. It also means that you can replace tenants since the geographical location is in your favor.
- High potential business types
To get the most out of your investment, you want to choose a growing location. Consider the business types in that location and choose those that are more recession-proof. That means that you will continue to attract business even in slow times despite the state of the economy.
- Choose reliable net lease advisors.
Finally, when investing in your triple net property, you want to ensure that the net lease advisors have the experience. Such a professional will help you navigate the triple net lease market and choose a property that you value.
You want to go through their portfolio to assess their past work to see if they align with your investment goals. And if they can help you choose the best triple net property for your investment portfolio.