Insurance Implications to the Triple Net Lease

Contributing Author: Mark Rogina, CPCU

Commercial property owners who lease out their buildings to others have multiple choices when designing the lease.  Even after the lease is designed, further consideration must be taken to determine the execution of the designed lease.

In the event a commercial property owner has chosen to utilize a triple net lease with their tenant, the next choice to be made is how to handle taxes, maintenance, and insurance costs.  The landlord has two options: 1) purchase their own insurance and pass through the cost of the policy to the tenant or 2) to allow the tenant to purchase their insurance directly.

The advantages to allowing a tenant to purchase commercial insurance for the property directly include:

Continue reading Insurance Implications to the Triple Net Lease

2019 NNN Forecast

Contributing Author: Sean O’Shea

As many much smarter ‘guys’ than me (and smarter women, too) are reviewing the last year; and struggling with Forecasts for 2019, at this time, there has been a lot of discussion about Fed Policy on rates and their impact.

Bloomberg had a recent interview with the legendary hedge fund and financial advisor, Stanley Druckenmiller, who was reviewing the last ten year era; and he was critical, then, (2009); and now, (2019) regarding rates and the liquidity implications of the unwinding of QE policies.

We think some useful language, is to characterize ‘asset bubbles’ or the asset inflation that these policies may have created as a real thing. Actually, many are referring to this period as the ‘Bernanke-Yellen Asset Inflation’ period.  

Continue reading 2019 NNN Forecast

What is the real role of NNN Properties in the Real Estate Industry?

Contributing Author: Sean O’Shea

It’s kind of funny to be considered, nominally, as a ‘nationally-recognized net lease expert’ after all these years.

My first exposure to this asset class was back a few decades ago, when I was charged with developing a real estate portfolio for a mineral-asset based Family Office in Fort Worth whose patriarch and predecessors were legendary oil wildcatters who wanted diversification to their Bond Portfolio.

My own background had been as a junior partner in a regional development firm with appropriate higher risk returns; and as a Shareholder of a regional commercial brokerage, whose business model was based on acute data and cultivating relationships, as the foundations for our demonstrative success in tough East Coast markets. Continue reading What is the real role of NNN Properties in the Real Estate Industry?

A Net Lease Asset History Lesson

Contributing Author: Sean O’Shea

We believe it is, in fact, helpful to have some historical sense of the evolution of the Net Lease Niche of the Real Estate Industry to have a better sense as to how these asset fit into the investment objectives of investors small and large in today’s maturing marketplace.

If you think about it, real estate, as an investment asset class, is a relatively recent development. It was always an entrepreneurial endeavor and was fueled as a worthy investment vehicle going back to the ‘mid-70’s and ERISA provisions, in those days total assets of private pension funds amounted to something like $164 billion dollars; today, of course, its in the “Trillions.” Continue reading A Net Lease Asset History Lesson

The Net Lease Niche

Contributing Author: Sean O’Shea

Over the last decade at various Net Lease Conferences on both East Coast (NYC) and West Coast (LA) I have been a Moderator and Panel Speaker. The most recent one was held in Los Angeles last week.

In attendance, were some of the giants of the Single Tenant Net Lease sector, like Realty Income, Angelo, Gordon & Co. and W.P. Carey. All multi-billion dollar asset owners who have enviable track records of consistent performance. They were an impressive cross-section of high net worth investors, Family offices and investment brokers from all of the major firms, SRS Partners, M & M, HFF, JLL (a lot of initials) and smaller service boutiques as well. Continue reading The Net Lease Niche

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