What are
NNN Properties?
NNN Properties are typically free standing buildings that are
leased to tenants for a 10 to 25 year term. NNN Properties offer the benefit of
little or no management responsibilities as the tenant pays for all, if not
most of the expenses. The investor receives their rent with little to no other
involvement.
Tenants in NNN Properties are divided by both quality and type of
businesses they are in. Qualitatively NNN Properties have either credit or non
credit tenants. The most desirable (least risk) NNN Properties have investment
grade (rated BBB- and better) credit tenants.
Non credit tenant NNN Properties have tenants that are not credit
rated. These tenants frequently are regional or local businesses or companies
that are unrated. Some tenants are considered credit worthy yet are unrated
because they carry no debt on their books. Click Tenant Ratings for list of tenants for NNN
Properties.
Who Buys
NNN Properties?
NNN Properties are appealing to those who wish to have outright
ownership of their commercial real estate investments and have little to no
management responsibility. The alternative ways of owning non management
commercial real estate would be to own a security in the form of a mutual fund
or REIT or invest in fractional ownership Tenant in Common properties.
A major advantage of 100% direct ownership is control and the
ability to defer future capital gains by doing a 1031 exchange when the
property is sold. For many investors the lack of immediate liquidity inherent
in NNN Properties is offset by the lack of volatility NNN Properties offer when
compared to a securitized investment. Investors should carefully consider their
need for liquidity when considering investing in NNN Properties.
J. Michael Sigrist
Compass Investment Properties, Inc.
861 W. Morse Blvd. #250
Winter Park, Fl. 32789
Office 407-647-5111
Fax 407-629-9220
Cell 407-953-2605
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