What to Look For In a Triple Net Property Investment
As you think of the best investment to real estate investment, thinking about the triple net property investment may one of the wisest decisions you can make in terms of real estate investments. You only have to know it is a long term investment and you need the right location, asset. Lease and ownership. When it comes to location, you need to think about replace ability and the tenant demand. When your property is in a stronger location, you are sure it will cost more.
When it comes to the asset you will need it to be in the right conditions and also asking for the right price. The condition and the price go together. The right asset will allow you to replace tenants when it is time to do so. When you have an asset that is custom-made for a particular client, you may have issued when it comes to changing the tenants.
The other thing to think about is the tenant. The the current volatile economy, you need to be sure you have chosen your tenant wisely. It is crucial to ensure that your tenant has a good credit rating. When you are looking for the right tenant, you need to make a difference between corporate backed and franchise backed leases. You may be thinking that a certain lease I strong based on the strength of the corporation but if the particular corporation is not liable for the lease then it will not be as strong as the parent company. 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. All that information can be available on the internet. The right lease should be the one that is long enough to offer stability and also lease bumps so that it can take care of rent increases. The right lease should not be subjected to any premature terminations.
The other important thing that you should consider is 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 is important to have the ownership of the ground where the property is other than the property alone. You need to make sure you understand fully how the land you are investing on is fully owned. You need to be sure before you start on your investment about the ownership structure and avoid anything that is not clear. 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.