Triple Net lease investments are investments where credit tenants lease their property most for periods of 5 to 25 years. In this case, the tenants are liable to pay all the expenses involving taxes, utilities, insurance, and maintenance. It is the kind of investment that allows investors to expand their portfolio. It minimizes risk exposure, and it helps the investor to generate reliable income mostly resulting from deductions for depreciation and interest expenses. As a result, net-leased investments have become very popular among real estate investors. Check out triple net lease to learn more.
Some of the net-leased properties available include the single tenant and the stand-alone retail properties. Examples of such properties are among others banks, discount stores, drug stores, and restaurants. The most important thing to consider in net lease investments is the creditworthiness of the tenant. Check out triple net for more information,
Triple net-leased properties vary with asset type, tenant credit quality, lease term, value, size of the property, and location of the property. Triple net properties that are more likely to give you a constant income are those that are located in critical areas where tenants have a substantial credit and a long-term lease. Visit https://en.wikipedia.org/wiki/Net_lease for more references.
There are various reasons why investors opt for net-leased investments. One of the grounds for choosing this type of investment is that it provides for long-term tenants. This saves the investor time and money lost during the period of looking for new tenants while the property is unoccupied.
The other benefit of net lease investments is that it shifts the burden of maintenance and care of the property to the tenant after all contract papers have been signed.
Financially, the net-leased invested are beneficial in that they provide a consistent flow of income. You will also benefit from high rates of returns. This results from the fact that long-term lease tenants with strong credits will give the investor a predictable income for a long time.
Also, net lease investment provides the investors with the opportunity to diversify their investments by choosing a variety of property types and sizes and varying the geographical locations of the investments.
If you are an investor who is willing to engage in net lease investments, it is important to note that there are also risks involved. One of the dangers is the vacancy risk that arises when a single use building has become entirely vacant resulting in loses. Sometimes the tenant can also go bankrupt and default payments for the lease, thereby affecting the cash flow and the property value negatively.
You can visit relevant websites to find more information about net lease investments.