American Rental Reviews

Reliable Passive Income: Landlords receive a steady stream of rental income with minimal hands-on management responsibilities.

Long-Term Leases: Typically 10 to 15 years, providing long-term occupancy and reducing the risk of hefty rent increases.

High-Quality Tenants: Often occupied by high-quality tenants like Walgreens or Starbucks, reducing the risk of lease default.

Build Equity: A portion of the lease payments can be used to make mortgage payments, reducing the principal balance and building equity.

Lease Transfers: The lease agreement can be transferred to a new owner, making the property more desirable for investors.

Protection from Operating Expense Increases: Operating expenses like property taxes and insurance are passed through to the tenant, protecting the landlord from unexpected increases.

Limited Upside: The benefits of a triple net lease are often priced in, limiting the potential for significant returns.

Vacancy and Rollover Costs: If a single tenant leaves, the property may become vacant, and retrofitting the space for a new tenant can be expensive.

Liability: The property owner may be exposed to liability due to heavy foot and pedestrian traffic, especially in office and retail properties.

Price Gaps During Negotiation: Valuing properties with triple net leases can be challenging due to differing perceptions of risk and market conditions.

Tenant Responsibilities: Tenants are responsible for all property expenses, which can be a significant burden and may lead to higher costs if not managed properly.