What to Look For In a Triple Net Property Investment
If you are wondering the best investment you can make in real estate, triple net property investment is one of the best income generating projects in the real estate business. All what you need to have in mind is that it is a long term investment and you must be sure you have the best location, asset, tenant, lease as well as ownership. When it comes to location, you need to think about replace ability and the tenant demand. You are sure to fetch more with a property that is in a stronger location.
When it comes to the asset you will need it to be in the right conditions and also asking for the right price. The cost and the condition depend on each other. The right type of asset is the one that you can replace tenants when need be. You may not be able to replace your tenants easily if or asset is custom made to suit a certain client.
It is also important to consider the tenant for the property. In this volatile economy, you should think about having the right tenant You need to ensure that your client has a high credit score rating. As you make your choice of tenant, you need to differentiate between the corporate backed and franchise backed kind of lease. The strength of a certain brand may indicate how strong the company is but it may not be an indication of the strength of the leas especially if it is not backed by the parent corporation. It will be wise to consider the tenants who are protected by a more volatile economy.
You should be well guided as pertaining to the right lease before you make your selection. The internet can be a good resource when it comes to such information. The best lease should be long term for stability and provision for lease bumps that take acre of increases in rent. The right lease should not be subjected to any premature terminations.
You should make sure that you think about the ownership structure. It is important to make sure that you understand the different types of real estate ownership. There are two important types that are highly recommended. You can either have a fee simple ownership or a fee ownership lease. It will be better if you can have the ownership of both the land and the property other than the property on leased land. You need to be sure about the ownership of the property that you are investing on. You should avoid putting your money on a property that you are not sure about. Real estate is a big investment and you need to be sure that you have done your homework well before you put your money there.