101 Guide to NNN and NNs

What are "Triple Nets" and "Double Nets" anyway? Here's what you need to know.

A triple net (NNN) property is a parcel of commercial real estate--land and building--leased long-term to a single corporate tenant.

Examples of essential NNN tenants are Chick-fil-A, Chase Bank and Chipotle. Essential means they continue to operate during a pandemic; and many are now thriving post pandemic. NNN leases generally have a long duration, 10 years or more. They require the tenant to pay steady, rising rent to the owner, as well as property taxes, upkeep, and maintenance for the life of the lease. Consequently, owners of NNN-leased real estate have almost zero expenses.

A double net (NN) property is similar to a NNN property. The primary difference is that the owner is responsible for limited upkeep on the property--such as maintenance of the roof. NN owners often secure a warranty to cover the costs of such maintenance. Examples of NN tenants are Starbucks, Verizon and Amazon Fulfillment Centers.  RealyInvest will invest in NN's only when such a warranty covers expected maintenance or the tenant is responsible for reimbursement of those costs.  Shareholders have no financial responsibility for any property apart from their share price.

NNN and NN lease agreements usually include regular, predetermined rent increases over the term of the lease, providing a growing income stream for the owner. These rising rents potentially raise the value of the property.

These properties can be a source of above-market yields, especially when the average money market yield is .08% according to March, 2022 FDIC data; and, real estate can be an effective hedge against inflation and stagflation.

All these benefits can make top tier NNN- and NN-leased properties highly desirable investments. In fact, the wealthy have been investing in them for generations, seeking their conservative, stable, increasing income stream and potential asset appreciation. 

There’s one big catch however: the best NNN and NN properties come with high, often multi-million dollar, price tags. But now with RealyInvest, you too can enjoy the benefits of NNN and NN ownership for as little as $20. Get started today and create an investment portfolio of RealyInvest properties. Get real with your money. 

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