What Is a Triple-Net Lease?
A triple-net lease, also referred to as a net-net-net lease and NNN lease, is a lease agreement where the lessee (a single tenant) is responsible for paying the lessor (landlord) on a net-net-net basis for the following:
- real estate taxes;
- insurance; and
- property maintenance.
Technically, the lessor owns the building and land but assigns other operating expenses to the lessee in addition to the basic rent, such as building maintenance and repairs.
Reduce the Risk of Triple-Net Lease Real Estate Investments and Rental Agreements
The key to minimizing the risks associated with triple-net lease investments and rental agreements is to understand the condition of the building as a whole throughout the entire term of the lease or rental agreement. This can be done by having a visual inspection performed on the property recurrently. The visual inspection should be performed by a third-party professional inspector. This benefits both the landlord and tenant.
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