How to Select the Right Triple Net Property Investment
When you are thinking on the way to invest in property, triple net property investment can be one of the most reliable forms of real estate income producing investment. 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.
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 and the condition depend on each other. The right asset will allow you to replace tenants when it is time to do so. When you have a custom-made property for a certain tenant it may be difficult to replace with another one in case there is need to do so.
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. You have to choose a tenant with the best credit rating. When you are looking for the right tenant, you need to make a difference between corporate backed and franchise backed leases. 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 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 lese should be stable enough and also make sure that there is enough provision for the rent increases. It should be free from any 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 choose between a fee simple ownership and a fee ownership lease. You would rather have either the ownership of both the property and the land or at least the land other than a property on a and that is on lease. You should be careful when you are making your investment to know about the ownership structure. You need to be sure before you start on your investment about the ownership structure and avoid anything that is not clear. Investing is real estate s a huge investment and you must be sure that you will have nothing to regret about.