Absolute Net Lease

Absolute Net Lease June 16, 2022

What are they and how can they work for me?

As stated in our Absolute Net Lease FAQ: An absolute net lease, absolute triple net lease or absolute NNN lease property is a lease in which the tenant is paying the landlord a lumpsum of monthly rent but also pays for all expenses of the property and daily operations of the business.

Head of the Net Lease group, Jonathan Hipp, states that the three main aspects on an absolute NNN lease are the following: 

1. Absolute Net Leases are PASSIVE investments. 

2. Absolute Net Leases relieve the investor of all landlord responsibilities.

3. Absolute Net Leases are usually with tenants with great credit.

So, what does all of this mean in detail?

Absolute net leases are passive investments because they are hands-off investments. As the investor you collect a rent check every month. These rent checks have built-in increases each year to make sure you are earning on your initial investment. 

One key detail for investors about absolute NNN leases is that they do not have to be the landlord. The tenant is responsible for the upkeep of oth the business and the facility. There are no out-of-pocket expenses that the investor needs to pay. This includes: taxes, maintenance, repairs, equipment cost, landscaping, parking lots, roofing, etc.

Most absolute STNL leases are with credit or national tenants. These leases usually carry a corporate guarantee. A corporate guarantee is a section of the leases that states that the investor will be recieving a rent check each month regardless of sales at the specific location. The company itself guarantees to pay the investor for the term of the lease.

If you think that investing in a stable, long-term, passive investment like an absolute net lease, reach out to our national experts here.