Advantages of Investing in a Triple Net Lease Property
[{"id": "esnj4fn", "text": " Triple-net properties have better terms of loan because of commercial real estate lenders, like a bank or a private lender, analysis the potential of the property rather than the buyer\u2019s credit.", "replies": [{"id": "esnk2k3", "text": ".....depends on lessee", "replies": [{"id": "esnkww5", "text": "And buyers credit can indeed still matter quite a bit.", "replies": [{"id": "esnl1xm", "text": "Of course. As I said, it depends on lessee", "replies": [{"id": "esnl375", "text": "Agreed just poking more holes in OPs .. post", "replies": [{"id": "esnl5t6", "text": "Yeah well it\u2019s pretty easy when he\u2019s saying NNN are always #1 based off \u201ctriplenetproperty.com\u201d \ud83e\udd23\ud83e\udd23\ud83c\udf7b", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "esnwoo8", "text": "If you want to invest in a NNN lease property do it through a NNN lease REIT another direct once the tail term is under 7 years there\u2019s no liquidity left and if you pick the wrong tenant (ie Rite Aid) you end up with a vacant box that you need to spend a gazillion dollars to re-tenant. \n\nNNN &amp; Workforce housing aren\u2019t real estate investments their financial engineering tools. Your ability to do well depends entirely on (1) the flexibility and rate of your financing (which you can\u2019t beat a hedge fund on) (2) your ability to have leverage to negotiate a renewal which consists exclusively of paying the tenant the DCF of their lease term as \u201cTI\u201d (even though it\u2019s not it\u2019s just corporate financing, they won\u2019t improve the way property) using a negotiated discount rate. You won\u2019t be able to beat a hedge fund on this one either (and will need to come out of pocket a ton of money). The spread between discount rate and financing rate is where you make money. \n\nMy $0.02", "replies": [{"id": "eso1ygh", "text": "Very good points. I think the only thing that changes the analysis a bit is depreciation. That will get you a better after tax return than a REIT. \n\nThe tenant risk is definitely there, but assuming an investment grade tenant, you should be able to get your initial investment out with a small return before your loan comes due. If non-recourse, that empty box worth $20psf becomes the lenders problems.", "replies": [{"id": "esqsgrn", "text": "But why bother if you\u2019re just going to give it back to the bank and fuck Up your credit? Honestly you can do it on your own, you just won\u2019t be able to do it nearly as well as a dedicated INSTITUTIONAL NNN investor can. Key word institutional their are a lot of scam artists in the NNN world. Caveat emptor.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]