Double Net Lease Vs. Triple Net Lease

When you’re comparing different net lease properties for sale, an important aspect you should consider is the type of net lease agreement in place with existing tenants (or what type of lease will benefit you most on a new property with new tenants).

All net lease deals are structured according to how financial and tax responsibilities will be divided among the property owner and the tenant. The main factors include:

  • Property Taxes
  • Insurance Premiums
  • Property Upkeep, Maintenance, and Improvements

In a single net lease, the tenant is responsible for rent payments each month as well as annual property taxes. The property owner is financially obligated to take care of insurance premium costs and also pay for any maintenance the building needs during the term of the lease. Single net leases are fairly uncommon, and even though tenants are financially responsible for taxes, it often falls upon the property owner to collect that sum and remit it on the tenant’s behalf each year.

Double net leases and triple net leases are the most common agreements, and they typically vary on one main factor, but it’s an important one that will ultimately determine your involvement and financial responsibility as a landowner-property upkeep, improvements, and maintenance.

This post will explain both double net and triple net leases and describe the key differences you should know when considering these different deal structures.

The Pros and Cons of a Double Net Lease

A double net lease is the tenant is responsible for:

  • Monthly Rent Payments
  • Property Taxes
  • Insurance Premiums and Deductibles on the Building

However, in a double net lease, the property owner must fulfill all the financial duties of a landlord associated to keeping the building in good operating condition, which includes improvements, regular servicing and maintenance, and any other unanticipated structural or operational issues that may arise.

In a double net lease, the tenant typically takes care of property taxes and insurance, which can be advantageous as a property owner, especially at tax time each year. But, the owner must also be prepared to be a landlord and be able to fund any costs associated to the ongoing upkeep of the property.

The Advantages and Drawbacks of a Triple Net Lease

NNN properties are very appealing from an investment standpoint due to the many advantages this type of deal can offer to both property owners and tenants. 

  • Guaranteed (Often Long-Term) Occupancy
  • Low Risk, Solid Reward Investment
  • Reliable, Predictable Income Stream Each Month
  • Low Touch Investment with Limited Management and No Landlord Duties

While an NNN lease can offer an array of great advantages for investors and tenants both, there are some limitations inherent in these deals that keen investors will want to keep in mind when considering an NNN lease.

NNN leases are popular among investors who are looking for a long-term, reliable investment with consistent income each month. But this also means there’s not typically a lot of room for expanded earning potential during the term of a lease. This can vary based on the property type and location, and some triple net leases include regular rent increases over the term of the lease.

Working with a net lease advisor who understands the fine details and differences of various net lease structures will ensure that you know exactly what financial responsibilities you’ll have in your investment. Unexpected costs or duties can eat into your profits quickly and can be especially frustrating if you were not clear on exactly what financial obligations you have as a property owner.

Sands Investment Group is made up of experienced advisors and brokers who have extensive expertise in net leases. Our team can advise you on all the intricacies and benefits of investing in double and triple net properties, based on our proven track record of successfully closed deals and satisfied investors (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 current net lease investment opportunities? Get in touch with an expert today by calling 844.4.SIG.NNN or sending us an email at

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