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. You are sure to fetch more with a property that is in a stronger location.
When you are thinking about the asset, it has to be the right one, in its best condition and fetching the right amount. The cost will depend on the condition. The right asset will allow you to replace tenants when it is time to do so. You may not be able to replace your tenants easily if or asset is custom made to suit a certain client.
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. 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. 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 is also wise to think of tenants who are protected or benefiting from the amore volatile economy.
You should be well guided as pertaining to the right lease before you make your selection. You can get such information from 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. It should not also be subjected to early terminations.
You should make sure that you think about 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 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. Real estate is a big investment and you need to be sure that you have done your homework well before you put your money there.