Guidelines on 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 to know is that, you will be entering into a long term investment, and you need to have the best location, the right tenant, asset, lease and ownership. As you think about location, you should be thinking in line with replace ability and the market demand on the property. The property that is in a stronger location is sure to fetch higher amount.
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 will depend on the condition. You will be able to replace tenants easily when you have the right asset. 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. .When you are dealing with a volatile economy, it is crucial to choose the right tenant. You need to ensure that your client has a high credit score rating. As you think of which tenant should be right for you, it is important to put into consideration the corporate backed and the 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 also need to know all about the lease information before selecting the right lease. You can get such information from the internet. The best lease should be long term for stability and provision for lease bumps that take acre of increases in rent. It should not also be subjected to early terminations.
The other important thing that you should consider is the ownership structure. You need to learn and be familiar with different real estate ownership types. The recommendations are upon two types. The first one is the fee simple ownership and the other is the lease fee ownership. It is important to have the ownership of the ground where the property is other than the property alone. You should be careful when you are making your investment to know about the ownership structure. You should avoid putting your money on a property that you are not sure about. Before you invest heavily in any real estate investment, you need to be sure that you have done your research well and you are sure it is the right thing to do.