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Triple Net Lease (NNN) Explained
Definition of a Triple Net Lease - NNN
What Is A Triple Net Lease?
The terms
Triple Net Lease,
Triple Net Leased,
Triple-Net,
NNN,
Net Lease,
Net-Net-Net are interchangeable. The definition of a Triple Net Lease (NNN) requires the tenant to pay all insurance, maintenance, and taxes. The tenant is responsible for all normal expenses of ownership, leaving the owner free of day-to-day management responsibility.
Most commercial property triple net lease leases are often between 15-30 years and normally include cost-of-living rent increases. Rental payment continues for the full term of a triple net lease
lease. This makes the credit rating of the tenants very important.
Triple Net lease- Advantages
Here are a few benefits of an investment grade (defined as having a BBB- or Better Credit Rating by at least one of the rating agencies) 1031 exchange investment property:
1 1031 exchange properties can relieve owners from day-to-day management issues.
2 Steady income-stream potential paid by a corporate tenant.
3 A long-term lease to a corporate tenant with credit rating usually makes it easier to get a mortgage loan at favorable rates.
4 triple net lease
properties may have appreciated residual values because they are most often built for retailers who have researched the market to find high density, middle income areas with attractive traffic patterns.
Why triple net leases should align tenants and landlord interest Why Triple-Net-Leases should align tenant and landlord interest.
Many regional and national companies choose to lease their business property. Leasing the property gives the occupying companies the ability to control their physical environment without the financial commitment of ownership. By leasing the property, companies free up their corporate funds for business expansion and improvement. A triple net leases gives the companies control over the property they occupy without the capital commitment of ownership.
