From medical offices to strip malls and everything in between, real estate investors are constantly looking for the next investment opportunity to expand their portfolios. There is no shortage of investment opportunities, after all, and nearly every industry needs dedicated investors to help them succeed especially when investing in businesses for sale. As an investor, growing your portfolio and seeing a profit on those investments is undoubtedly important to you. Finding the right investment is key to that success.
SIG broker Kaveh Ebrahimi successfully closed 34 urgent care locations capitalizing on sector growth, selling 23 properties in 2020 and 11 YTD, while continuing to add listings into 2021.
Working with SIG brokers is the best way to leverage top listings, lending, and marketing efforts. SIG broker Kaveh Ebrahimi has specialized in urgent care facilities over the past 6 years, pioneering the sale of urgent care properties by closing on his first location back in 2015. Since then, his sales numbers continue to increase as he currently has 14 urgent care clinics in escrow with 4 scheduled to close in April 2021.
Shopping centers can be a great opportunity for commercial real estate investors. They offer variety in tenants, consistent income, and great potential for growth in the future. A shopping center can look very different, depending on the town or city, as well as the types of tenants the center tends to attract. Some may have a lot of chain stores, while others might have mostly local businesses. There may be a mix of retail, grocery stores, clothing stores, and furniture stores. Oftentimes, there can be many moving parts with shopping center investments, as there are usually multiple retail tenants to manage at any given time.
Sands Investment Group (SIG), one of the nation’s fastest-growing net lease brokerage firms, has completed the sale of a 70,000-square-foot office space in Huntington, West Virginia. SIG net lease broker offer unparalleled coverage of buyers and sectors in commercial real estate – nationwide.
In this transaction, SIG lead broker Teddy Leonard, along with co-broker Matson Kane, were able to assist their client in the successful acquisition of this 70,000 SF Amazon Customer Service property in Huntington, WV despite many challenges that arose in March at the end of the transaction due to the pandemic. SIG got involved on a local level by setting up meetings with local officials, including the Huntington Mayor, and the leaders of the investment group to alleviate concerns the investors had in the deal.
- Amazon Customer Service, Huntington, WV
- Property Type: Office Space
- Client Type: Private Equity Buyer
- Price: $16,851,771
- CAP: 7.00%
- Challenge 1: First large-scale transaction for the Buyer. The Seller needed to be made comfortable with their ability to close the transaction.
- Challenge 2: Asset in secondary market.
- Challenge 3: 70,000 square foot building with large rent presented some challenges to provide sale/rent comps.
- Placed the client goal as a top priority which was looking for an investment grade tenant with a 7%+ yield.
- Pandemic wiped out 30% of the committed money in syndication and buyer had to get creative to find replacement investors two weeks before closing.
Interested in acquiring an office property for sale to add consistent returns in your investment portfolio? SIG handles new loans on locations for clients who are seeking to expand their portfolio and acquire NNN properties in all different niches. When the goal is growing an investment portfolio with specific properties, you can’t trust a typical real estate agency to walk you through the process. SIG is a commercial real estate brokerage firm with a wealth of experience helping clients find, secure, and purchase properties to round out their investment portfolio.
Whether you have medical experience or are just interested in investing in medical offices because they can make a great long-term investment, medical office properties can be a great addition to any commercial real estate portfolio. There are so many different types of medical properties that can be an asset—from small offices for private practice to large medical buildings or complexes.
In 2021, childcare assets are a product type to watch for commercial real estate investment opportunities. These assets are ideal additions to a net lease portfolio that provide long-term benefits and witness current growth as the industry bounces back from the COVID-19 pandemic. Childcare assets commonly provide long-term leases, corporate tenants with valuable reputations, strong operators, and—perhaps most importantly—owners who are highly committed to their businesses. These owners are passionate about their programs as they genuinely want to see children receive a quality education and care at their facilities.
Working with SIG brokers is the best way to leverage top listings, lending, and marketing efforts. In this deal, SIG lead broker Gerald Nash, along with co-broker Nick Stockton, was able to secure a buyer for this DaVita property for sale by leveraging the SIG platform, which allowed the client to gain a 13% profit.
SIG brokers handled a 1031 exchange on an Industrial Outdoor Storage property leased to Maxim Crane Works with a repeat buyer.
Working with SIG brokers is the best way to leverage top listings, lending, and marketing efforts. In this deal, SIG broker Amar Goli, along with co-brokers Greg Laughton and Clarissa Tarandy, was able to secure this 1031 exchange deal for a repeat client and demonstrate expertise in the industrial sector to best serve all parties involved.
As investors look into new opportunities for triple net lease properties, one type of business that’s repeatedly mentioned is a gas station. The best types of commercial real estate leases involve relationships with businesses that are recession-proof, meaning they will always be needed regardless of the current economy. Therefore, gas stations are a smart investment opportunity to consider.
Triple net lease (NNN) properties are often very attractive to investors who are seeking out an investment with consistent, equity-building returns without having to be involved in the day-to-day obligations and financial responsibilities of the property. NNN leases are also structured over a long period of time (usually anywhere from 10-25 years) so they can be an opportunity for consistent, long-term earning potential from the investment standpoint.
Investor interest has recently grown in a popular new class of net lease investments: car wash properties. Demand for car wash businesses continues to grow due to the vast number of cars on U.S. roads. These businesses also have a considerable advantage over other many types of retail—the internet cannot put them out of business. In other words, the only way to wash a car is to drive to the local car wash.
For real estate investors, 1031 exchanges create an opportunity for investors to move from one property to another and provide tax benefits for doing so. With the help of a tax-deferred exchange company, you can sell one or more property and defer the payment of capital gain taxes by acquiring a replacement property. This allows you to keep 100 percent of your money working for you instead of paying about one-third that equity to taxes. However, in a 1031 tax deferred exchange, there are very specific requirements that need to be followed.
When considering using a 1031 exchange for the sale of one property and the purchase of another, investors should consider the benefits they can gain from such a transaction. These 1031 exchanges are transactions that real estate investors often use to increase their wealth, save on taxes with the tax deferrals, and grow their portfolios. It’s a strategy that is used by many investors across the country.
Investing in commercial real estate can bring about many advantages in the form of low-touch income or a diversified portfolio. But not all commercial leases are the same, and even leases of the same type can have varying factors and deal details. In short, every commercial lease is usually as unique as the property itself, so it’s very important that you understand all the particulars and fine print of any property you’re considering adding to your portfolio.
Triple net leases, or NNN leases, are a very popular option for real estate. One type of NNN lease is a bondable lease. A bondable lease property has a long term tenant, of often ten years or more, with shared financial responsibilities between the landlord and tenant. Because of this, it can be advantageous for both property owner and business owner to have a bondable lease on the right property.
Many investors like adding NNN properties to their portfolios for the benefits offered for both the property owner and the tenants of the space. However, it’s important to understand the difference between triple net leases and bondable leases. While similar, there are some distinct differences that can be beneficial for landlords and tenants alike.
Read on to find out what a bondable lease is and the benefits in triple net real estate, for both landlords and tenants.
What is the Definition of Bondable Lease?
A bondable lease in triple net real estate is a variant of the NNN lease, in which the tenant carries the real estate risks and all operating costs for the property. These additional financial responsibilities may include:
- Rental fees for the property
- Property taxes
- Insurance premiums
- Maintenance and repairs for the property, including structure and roof
A bondable lease differs from a traditional NNN lease in that more of the financial responsibilities are placed on the tenant. In an NNN lease agreement, the structure, roof, plumbing and other costs may fall on the landlord; while in a bondable lease, it is on the tenant to take care of any issues that arise with these items. Another difference that can benefit the landlord is that often in a bondable lease, the tenant cannot terminate the agreement.
Considerations For Bondable Leases
When an investor looks into properties for a bondable lease agreement, there are many things to take into consideration, including the location and the tenant type. Once an investor has made a decision to offer bonded leases in the future, these specifics can help to narrow down the search for properties – and for tenants, in the future.
Location: A good, bondable triple net lease property, is often in a high growth area. These may be new cities, or areas attracting new residents at a higher rate. Popular parts of town, close to well established businesses, are often good bondable lease properties, as the area may be established with customers who can become customers at the new business.
Type of Business: When considering businesses to offer a bondable lease to, landlords should consider the longevity of the company. The best types of businesses for this lease type are ones not susceptible to economic or technological changes. These potential bondable lease examples may include grocery stores, convenience stores, dollar stores, medical offices, etc. These businesses are always necessary and will not shift too much during times of economic crisis.
Lease Terms: Each bondable lease will have its own terms, just like any other type of lease. Landlords need to consider the terms for their bondable lease, and ensure both they and the tenant understand what is expected in the terms. Because of the shared responsibilities, this understanding is especially important. Terms can include:
- Division of financial responsibilities
- Pass throughs of taxes and operating costs
- NNN lease insurance policies and premiums
- Rebuilding the structure if necessary (after hurricanes, tornadoes, etc.)
- General maintenance coverage for structural or roof damage
The Benefits of Bondable Leases
There are a wide set of benefits associated with NNN bondable leases. Both the property owner and the tenant have several benefits they can find with this type of lease, making this an attractive option for both sides of the agreement. Landlords like the ease of this lease type, and tenants can find more freedom. Generally, both sides of the lease can find more freedom in this agreement than in other NNN leases.
4 Benefits For Landlords
- Consistent Occupancy: Triple net leases are usually long term (somewhere between 10 and 25 years), so landlords will know they have a consistent, reliable income stream for that property. This can help to reduce the time and money spent on searching for new tenants or letting properties sit empty for periods of time. The regular rent, without additional costs associated with the property, can give landlords more freedom from spending time on the bondable lease property.
- Fewer Responsibilities: With a bondable lease, landlords do not have as much responsibility as other types of leases. The responsibility for property taxes, insurance premiums and maintenance or repairs falls on the tenant. This gives the landlord more freedom and time to focus on other projects or properties.
- Predictable Cash Flow: Because of the consistent occupancy and the limited responsibilities landlords of bondable leases have, they can find a passive source of predictable income, allowing them to know how much money they will bring in each month for a set amount of time and freeing up their focus for new or other properties.
- Low Risk and High Return: NNN leases each have their own terms, but because most (if not all) of the risk is passed to the tenant, landlords often see these properties as low risk and high return. Again, the bondable lease property gives landlords the freedom to continue to add to their portfolios in other ways.
Each of the benefits a landlord finds can free up their time, money or energy to focus on new projects and other properties. This can help investors continue to grow their portfolios.
3 Benefits For Tenants
- Established Location: As a business owner, it can be challenging to have a shorter-term lease. With the long-term lease afforded by the bondable net lease, tenants can have an established location their customers can rely to be there for many years. This can give them the freedom and opportunity to grow a stronger customer base.
- Long-Lasting Footprint: With a stronger customer base at an established location, tenants can develop a long-lasting footprint in the area. They can focus more on building their business, rather than finding a new place to do business every few years. By creating a long-lasting footprint, tenants can grow their in-the-door traffic for their business, giving them the freedom to become a part of the community.
- Property Control: With a bondable lease in triple net real estate, the tenant is responsible for the property they are renting – which means they have more control than in other types of leases. If the tenant notices a maintenance issue, they can go ahead and get it repaired as they see fit, without needing to involve the landlord. This gives them the ability to fix issues as they arise and on their schedule, often resolving problems quicker than they may otherwise.
Tenants can find freedom to build their business and establish themselves in their community because of the longevity of their bondable lease.
Investing in Bonded Lease Properties
Once an investor has decided to invest in bonded lease properties, it can be helpful to do some research on the types of properties for the tenant types the landlord is interested in working with. A net lease real estate expert can help investors sift through the listings to find the best properties for their needs. They know the right questions to ask when looking at listings and how to decipher the fine print on existing leases. This will help the investor know what responsibilities they might inherit in a new property with an existing tenant.
A net lease advisor can help landlords understand the pros and cons of bondable leases. These experts know market trends and know the longevity of different types of investment locations that may be good for a bondable lease property. A bondable lease expert can help find the right property for ongoing, consistent income for property investors.
Sands Investment Group is America’s fastest growing net lease investment company, with over 2,200 transactions in 48 states (to the tune of $4.7 Billion) since 2010. Our experienced team of net lease advisors and brokers are experts in the NNN market and can help you find your next best investment opportunity by helping you navigate through all the opportunity and risk factors of every NNN property that meets your investment goals.
Want to learn more? Get in touch with an expert net lease advisor today by calling 844.4.SIG.NNN or sending us an email at info@SIGnnn.com.
SIG brokers successfully handled the transaction on a CVS drugstore in Atlanta, Georgia despite facing multiple challenges.
Working with SIG brokers is the best way to leverage top listings, lending, and marketing efforts for commercial real estate in Atlanta. In this deal, lead SIG broker Amanda Reeves and co-brokers Doug Roland, Dan Hoogesteger, and Danny Held successfully closed a CVS transaction despite facing challenges with the age of the listing and multiple instances of the deal falling out of escrow.
Triple net leases are popular options for landlords and tenants alike. They aren’t your standard commercial lease agreement. They give property owners a consistent income stream with more time to focus on other projects, as day to day maintenance is typically passed to the tenant. This gives the tenant more control over the property, allowing them to make repairs when needed and sometimes even update the property as they see fit for their business. The costs associated with the property are split up between landlord and tenant in a different way than most other leases.
SIG brokers successfully closed the transaction on a 7-Eleven convenience store on Shiloh Rd in Dallas, TX.
Working with SIG brokers is the best way to leverage top listings, lending, and marketing efforts. In this deal, lead SIG broker Tyler Ellinger and co-broker Matt Montagne and William Hartshorn handled a successful transaction on a 7-Eleven business for sale in Dallas, Texas.
Investors are often attracted to NNN leases, or triple net leases, because of the consistent income stream they can provide while still being a lower risk property. These types of leases are a long-term solution for tenants, while providing property owners with plenty of benefits as well.