What is a Triple net or NNN lease investment and a 1031 Exchange A triple net lease (Net-Net-Net or NNN) is a lease agreement on a property where the tenant or lessee agrees to pay all of the real estate taxes, building insurance, and maintenance (the three "Nets") on the property in addition to any normal fees that are expected under the agreement (rent, utilities, etc.). In such a lease, the tenant or lessee is responsible for all costs associated with the repair and maintenance of any common area. This form of lease is most frequently used for commercial freestanding buildings. In a triple-net lease (NNN) example, the tenant pays all the operating expenses, property taxes, utilities, insurance premiums, maintenance and repairs. The landlord gets to collect monthly net rental income just as he or she would with a traditional real estate investment. Such a lease usually extends over the long term, with a financially strong corporate entity guaranteeing a lease anywhere from 10-25 years. NNN’s are typically purchased on a cap rate. A CAP rate is essentially a yield which is determined by dividing the tenant’s annual rent by the purchase price. For example, if Walgreens is paying $325,000 annually and the purchase price is $5,000,000, the CAP rate is 6.50% ($325,000/$5,000,000).
http://www.nnninvestmentforsale.com
http://www.nnninvestmentforsale.com
