Single tenant net lease properties are freestanding business locations that have just one tenant occupying the entire space. In contrast, multi-tenant properties (such as strip malls or shopping centers) have multiple spaces that are all occupied by different businesses. Single net leases are becoming a more a popular investment choice as the popularity of malls dwindles and due to the many perks they offer for an investor (and a tenant who gets to be the sole business and brand operating in the building).
Since triple net properties come with commercial price tags, investors often finance a portion (or all) of their purchase to begin taking advantage of these 5 benefits of single tenant net lease financing.
1. Single Tenant Net Lease Properties are Low-Risk, Low-Touch, and High-Reward Investments
Triple net lease real estate is popular among commercial investors who are looking for properties that are relatively low-risk and high reward, without a hefty amount of involvement and maintenance (whether on the property or with tenants). Single net lease properties can be ideal for such investors, because you’re dealing with one property, one long-term tenant (of anywhere from 10 to 25 years depending on the lease), and one set of agreement stipulations between you and the tenant. Multi-tenant net leases, however, tend to be more complex since you’ll be dealing with multiple tenants who will potentially all have different terms (and timeframes) outlined in their leases.
2. Monthly Rent Payments Offset Mortgage and Financing Fees
Financing a triple net property is a great way to get into an investment, even if you don’t have the full purchase amount liquid to buy in cash. When you work with a reputable triple net advisor such as Sands Investment Group, you have many financing options ranging from partial to full funding of your NNN property purchase.
Financing options will help you expand your options as you consider triple net properties for sale, and if there’s an existing tenant agreement in place, you’ll be able to immediately begin offsetting your financing costs with monthly rent from your tenant.
3. Enjoy Reliable, Steady Income (with No Surprises) with Tenant Expense Pass-Throughs
Financing a single tenant net lease property can provide you with a steady income stream that is especially reliable since you’ll receive a monthly rent payment from your tenant and you can pass along expenses associated to the building that would normally be an owner’s responsibility, such as:
- Maintenance and Upkeep Costs
Because the tenant will be responsible for the majority of the expenses on the triple net property, you won’t have to encounter any surprise repair costs, tax bills, or other maintenance fees that could detract from the profitability of your investment.
4. Low-Touch Management of Single, Long-Term Renter
When you finance a single tenant net lease property, you will be working with one (usually long-term) tenant who is invested in creating a destination for their brand, in your triple net building. This makes these types of investments very low-touch for the landlord. Because the tenant takes on all the operating costs, taxes, and maintenance fees as part of their business costs, you’ll rarely need to be involved in the upkeep of the building. This makes single tenant net lease properties ideal for those who want the perks of an investment property without all the traditional (and often burdensome) duties of landlord.
5. Expert Advice and Guidance from SIG
Purchasing a single tenant net lease property is a large investment, and one you need to make with careful consideration to the type of business location you’re buying and what type of longevity long-term tenants can create in that location. There are a lot of factors that go into choosing and financing a single tenant net lease property and working with a skilled team of advisors such as Sands Investment Group (SIG) can ensure that you have specialized support and guidance every step of the way.
Sands Investment Group is knowledgeable in all types of triple net leases (including single tenant net leases)and have the expertise to guide you through the process of finding and financing your next best investment (in fact, we’re the fastest growing net lease investment company in America, with over 1,700 transactions in 48 states (to the tune of $4 Billion) since 2010.)
Want to learn more about NNN properties for sale and speak with an industry expert about financing a single tenant net lease property? Get in touch with an expert today by calling 844.4.SIG.NNN or sending us an email at info@SIGnnn.com.