A net lease property refers to a type of property lease in which the tenant pays at least one additional expense in addition to rent. The main function of this type of lease is to help landlords reduce the risk of renting property. There are three common types of net leases and these are single, double and triple net leases. Each of these types of net leases conveys a greater onus on the tenant depending on its type. To compensate for this increased cost of rental the base rent for the property is typically lower than it would be without the additional financial responsibilities.
Single Net Lease
A single net lease is commonly called an N lease or just a net lease. This type of net lease is not particularly common as typically double or triple net leases are preferred. With this type of net lease the tenant pays for the property tax of the property which they are renting in addition to their rental. As a result, the other expenses which accompany the property are the responsibility of the landlord. This can include expenses such as property insurance and utility costs as well as general building maintenance. In order to make such a lease appealing for tenants they will usually pay a lower base rental for the property.
There are still responsibilities which the landlord will be responsible for and this includes the possibility of the tenant missing or being late for the payment of property tax. This is why it is more common for the landlord to include the cost of property taxes in the rental itself so they can ensure that this is paid on time. If the property tax is not paid on time the landlord can be liable for fines or additional expenses.
Double Net Lease
A double net lease is commonly called an NN lease or a net-net lease. This type of net lease is far more common for rental properties particularly in the commercial property sphere. In a double net lease the tenant is responsible for the property taxes as well as the insurance for the property. Maintenance costs are still the responsibility of the landlord who covers these expenses in a direct manner. To compensate for the increased cost to the tenant the base rental for a double net lease is lower than for a traditional lease.
Triple Net Lease
A triple net lease is commonly called an NNN lease or a net-net-net lease. This type of lease requires the tenant to pay for the property taxes, the property insurance and for the cost of maintenance and repairs to the building itself. This type of lease is very appealing for landlords because it shields them from a great deal of liability and risk. Similarly to single and double net leases the rental for triple net leases is generally lower. This is the type of net lease which Net Lease World uses for the properties which it offers.
Net Lease World
Net Lease World is a platform which facilitates an incredibly simple and efficient way of transacting net lease properties. The platform has portals for both buyers and real estate agents which creates an easy to use system for net lease property transactions. Net Lease World allows its users to sort the available properties by a number of useful criteria such as annual rental income, cap rate and property type. This allows users to find nnn properties for sale which meet their criteria with an ease that competitors struggle to match. Additionally, the platform has the functionality of making an offer on the property online which further increases its usability.
Final Thoughts
There are three main types of net leases. These are single, triple and double net leases. Single net leases require the tenant to pay for property tax in addition to rent. Double net leases require the tenant to pay for property tax and property insurance in addition to rent. Triple net leases require the tenant to pay for property tax, insurance and maintenance costs of the building. This is the most preferable type of net lease for landlords as it reduces risk the most compared to the other types of net leases. Net Lease World simplifies the process of transacting triple net lease property through its intuitive and user friendly interface which is why they are making it easier than ever to invest in net lease property.
