Triple-Net Lease (NNN)
Hands-off. Low risk. Steady Income.
NNN properties are the easy-button of commercial real estate investment. Want in?
Triple Net Lease (NNN)
What is a Triple Net Lease (NNN) investment?
For many, real estate investment is at its best when its hands-off, low risk, and produces a steady income.
For investors who think this way, they’re not interested in the day-to-day work of property management. These are often people with a career’s worth of capital and experience. They’ve done the difficult task of growing their business or portfolio.
They want to relax, freeing themselves of the responsibility to make improvements, oversee repairs, and pay monthly bills:
- Entrepreneurs ready to divest themselves of their business
- Real estate investors looking to sell the property they actively manage
- Anyone who wants to invest in a safe, high-yield, no-hassle commercial real estate property
- Individual looking to pass on their stable investments, wealth, and income to subsequent generations
Investors like these may be ready for a triple net (NNN) investment property. These are properties where the tenant is responsible for real estate taxes, insurance, and maintenance (the 3 “nets” of real estate).
For NNN leases, when something goes wrong, the tenant has the cash, motivation, and core-competencies to take care of the problem. Landlords don’t have to worry about roof repairs, leaky faucets, remodeling jobs, or insurance claims.
And, NNN tenants can handle all the accounting themselves. They pay on time and take care of everything. Does that sound like the opportunity for you?
If so, Hilliker brokers — in collaboration with our sister company, Westwood Net Lease Advisors — expertly guide investors into triple net investments. And a carefully chosen NNN property can provide you (and your heirs) with income for years to come.
What is a Triple Net Lease (NNN)?
A triple net lease (NNN) is one in which the tenant usually handles three categories of expenses:
- Insurance
- Build-out and repairs
- Taxes
NNN tenants are typically highly creditworthy national chains. They include (though aren’t limited to):
- Retail chains like Dollar General, 7-11 and Walgreens
- Restaurant chains like Buffalo Wild Wings, Applebee’s, and KFC
- Auto maintenance chains like Good Year, AutoZone, and O’Reilly Auto Parts
- Institutions such as Chase Bank or Goodwill
- Medical facilities such as Fresenious Dialysis, NextCare Urgent Care, or Surgery Partners
For NNN tenants, the business itself is their primary focus. They don’t want to own the property itself. But since NNN tenants are usually businesses that see customers day in and day out, they’re highly motivated to keep the building beautiful and functional.
For those interested — and well-positioned — for a triple net investment, here’s how we proceed.
Roll Your Current Investments through a 1031 Exchange
A 1031 Exchange is a tax deferment tool. It allows investors to use all the proceeds from the sale of one investment property for a “like-kind” exchange — another property held for a business or investment purpose. It has to meet specific requirements, and you can read more about 1031 Exchanges here.
First, Hilliker Corporation brokers can help you list and sell your current investment. With experience that dates back to our founding in 1985, we’ve completed over 10,000 transactions. Your Hilliker broker will help you:
- List and market your current property
- Find a buyer
- Effectively negotiate its sale
Simultaneously, in conjunction with Westwood Net Lease Advisors, we can help you gather the team you’ll need to set up a 1031 Exchange successfully:
- Accountant
- Lawyer
- Lender
- Contractors
- Title company or other “qualified intermediary”
- Any other professionals needed for your specific situation and goals
Then, your broker can become the hub around which all the action takes place. When you work with us, you’ll know what you need to do, who you need to speak to, and where you need to be.
With Hilliker Corporation, you’ll get the deal done with as little friction as possible.
Find and Negotiate Your Triplet Net Property (NNN) Purchase
First, your Hilliker broker can help you sell your current commercial property or properties.
Then, we collaborate with Westwood Net Lease Advisors to identify lucrative opportunities for a triple net investment. Together, we will assess:
- Your goals
- Your budget
- Your risk tolerance
From there, we’ll provide you with our pipeline of potential properties and tenants. You’ll have the tools and experts at your disposal as you evaluate:
- Tenant creditworthiness
- Lease terms
- Properties
- Locations
- Capitalization (cap) rates
Once you own the property, there’s little left for you to do! Since your tenant is a company that takes care of almost everything, you don’t have to manage it actively. You just collect the rent checks.
It really is the easy-button of real estate investing.
Your Real Estate Life Cycle Options: Divest, Diversify, or Upgrade
Our triple net investors are usually in one of two phases of their Real Estate Lifecycle.
Those in the Growth and Maturity Phase may desire greater portfolio diversity. Those in the Exit Phase may seek reliable income without the stress of property management.
Whatever your situation, you can continue to leverage your property well into the future.
Divest
If you decide it’s time to pull out of your commercial real estate holdings altogether, we can match your current properties to new buyers.
Diversify
As the value of your investment grows, and your purchase power increases, expand your NNN portfolio into different industries or locations.
Upgrade
As mentioned earlier, 1031 Exchanges allow for tax-free reinvestment indefinitely. Grow your income, your freedom, and the benefit to your heirs. Wherever you are in your Real Estate Lifecycle, we have options tailored to your situation and geared for your success. If you’re ready to make your next move, contact a Hilliker broker today.
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