Successful real estate investors looking to diversify their portfolios buy and sell properties all the time. However, real estate transactions are typically accompanied by a myriad of fees, costs, and taxes that can diminish profit margins. A 1031 exchange allows investors to dispense with certain real property and acquire another of a similar commercial nature. These are referred to as the...
When we talk about commercial real estate leases, you are probably already familiar with the two types of leases: a gross lease and a net lease. These leases serve as an agreement between the parties involved (a commercial tenant and the landlord). They cover the basic details of which party will be responsible for the maintenance and upkeep of the property (basically, all the expenses). While a...
An excellent example of a multi-tenant net lease property is the apartment building from the famous sitcom Friends. The building’s landlord receives rent from at least four of the six main characters in the series and the other tenants and the owner of the coffee shop, Central Perk, which is situated on the first floor of the building. Now imagine an alternate universe where Terry, the owner of Central...
A like-kind exchange or 1031 exchange is where one investment property is swapped for another. According to Section 1031 of the Internal Revenue Code, any taxpaying entity, including individuals, partnerships, trusts, companies, and corporations can set up a like-kind exchange. Per the 2017 Tax Cuts and Jobs Act (TCJA), only exchanges of real property are permitted. Under the new rules, the term “real...
A double net lease — like other net leases — is typical in commercial real estate. While some may have trouble understanding the terminology, net leases are simply contractual agreements in which the tenant or lessee of a property is required to pay rent and some or all of the property’s expenses. Under normal circumstances, the landlord or lessor would be responsible for property taxes, insurance,...
So, what is an NNN lease? For starters, it's a method of generating passive income with little to no effort on your side. A triple net lease is a type of agreement on a property in which the tenant promises to cover all operating costs in addition to providing rent. In other words, you're able to collect regular monthly paychecks without worrying about property taxes, maintenance, or insurance. Let's see...
Like with any other form of transaction, when it comes to real estate, the IRS identifies and collects its due tax for services the federal government has provided. Since real estate can actually generate gains for its buyers/sellers, the IRS categorizes this process under capital gain and taxes the parties involved accordingly. However, there are some laws/regulations that can alter this process. These...
Investing in commercial real estate has long been one of the easiest, most stress-free ways of generating passive income and enjoying financial freedom. We all know that being a private landlord comes with many benefits, but it also comes with just as many responsibilities, making an investment feel much more time-consuming to savvy investors who are looking for a more hands-off approach. That's where...
In commercial real estate, triple net leases for sale are a thriving niche. They are commonly known as NNN lease. Typical examples of triple net leases for sale are franchises, fast food chains, and convenience stores. However, industrial properties and significant office can also fall under this criterion.Characteristics of Triple Net Leases for SaleTriple net leases are a good investment opportunity, for...
Favorable conditions and strong cash flow have together fueled the demand for single tenant NNN properties for sale. Part-time investors are finding it as a lucrative opportunity to ensure a fixed income flow without having to take management responsibilities. For others with mature portfolios, this works as an exit strategy. Many people still invest in real estate to satisfy their overall asset allocation...