Triple net investments reduce headaches

Real estate investments are a great means of getting good returns on your money. However, sometimes, managing your real estate could be tedious. So if you want security and some income from your real estate, without any headaches, then it is better to go for a commercial triple-net lease property.

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Tenant pays rent and additional maintenance expenses

A triple-net lease investment is an investment wherein one owns real estate that is leased to a tenant for a term of 15 to 25 years. According to the terms of a triple-net lease agreement, the tenant occupies the property to operate business while paying rent and all property operating expenses like insurance, taxes and internal and external maintenance. Of course, ‘fair wear and tear’ will be permitted, which is to be included in the ‘fair wear and tear’ clause of the agreement.

Commercial tenants are better than residential tenants

Commercial property under a triple net lease agreement is considered a passive real estate investment. This form of an investment is better as in the case of residential property, there is the chance of the tenant abusing the property before leaving. In such cases, the owner has to refurbish the property when looking for new renters. Commercial tenants are considered to be positive business renters as they have a vested interest in the property and thus see that it is well maintained and attractive to clients and customers. So with the passage of time, the owner is at an added advantage as the tenant sees some economic incentive by enhancing the property!

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Rent increases can be claimed in accordance with inflation

The main advantage of a triple net leased property is that the owner faces little risk, gets a monthly income through lease payments, and can also claim a rent increase with inflation! With no property expenses, or any other taxes to be deducted from the rent money, the owner receives more rent. It is also very beneficial to use a triple net leased property as a replacement property when completing a real estate exchange transition. This is because many real estate investors dispose of management intensive properties for the more management free properties like triple net leased property!