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 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. As you think about location, you should be thinking in line with replace ability and the market demand on the property. When your property is in a stronger location, you are sure it will cost more.
You need to ensure that the property is in the right condition and fetching the right amount. The condition and the price go together. 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. In this volatile economy, you should think about having the right tenant It is crucial to ensure that your tenant has a good credit 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. You will need to think about the tenants who are beneficiaries of a more volatile economy.
You need to know all about the right lease before making your conclusion. 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 be free from any early terminations.
You also should be keen on the ownership structure. It is important to make yourself familiar with the real estate ownership types. There are two important types that are highly recommended. 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 need to make sure you understand fully how the land you are investing on is fully owned. 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.