What is the Landlord Responsible for a Triple Net Lease?


When we are talking about the crucial aspects of a profitable lease, it needs to be said there are two of them. We are talking about conservations and protection responsibilities. Naturally, these can be different depending on what sort of lease we are talking about. For those who don’t know, there are a couple of them. Sure, making a decision on which ones you will opt for, depends on the needs and preferences.

According to signnn.com and other similar companies, we can see that the commonest one is certainly triple net lease or NNN. The main reason for its popularity is its flexibility when it comes to performing all the repair and maintenance tasks. Leases have the task of defining the communication between the person interested in leases and a landlord.

We are talking about communication in which both parties have their obligations. Performing all of them directly causes them to be either effective or ineffective. At the same time, both parties can reap some advantages.

With all of these factors in mind, we can understand why NNNs are so sought-after among the investors, who are interested in having a steady stream of income. Now, we would like to discuss triple net leases in higher detail and explaining the tasks of both parties in the process.

What is NNN?


Before you are ready to understand the duties the property-owner and occupant have in this sort of agreement, it is needed to explain all the crucial points of this concept. In most cases, you will see that these agreements are lengthy. At the same time, they include a wide array of different factors, the most prominent of all of them being concessions for the potential rent increase.

What are Landowner’s Obligations?


First, we would like to talk about the landlord’s responsibility. At the first sight, it may look like the owner has practically no serious obligations. However, this simply isn’t the truth. It needs to be said that all the errands that needed to be fulfilled to the city or county are handled by the tenant.

But if they are not handled properly, the owner is the one who will be held accountable. For instance, if the renter didn’t fulfill all of his obligations, the owner could face some serious problems at the end of the term. For this reason, determining all the details of the contract is an absolute must.

What are Tenant’s Obligations?


With NNN, the occupant has a lot to think about. For instance, the resident needs to take care of all the conservation expenditures. Still, there are not only obligations. Furthermore, taking care of the fees and other potential payments is also handled by the resident.

Sometimes, these costs may be much higher than it was anticipated. To prevent this from happening owners would need to use a bondable net lease. We’ve mentioned that explaining all the details of the agreement is an absolute must. Preventing all the problems is certainly an important point.

What if Not All the Details are Discussed?

If the parties have not concluded on all the details in the contract, then there is a lot of potential problems that can arise in the future. That’s why we believe that renter needs to insist on including a cap on all the expenditures when a need for a new lease emerges.

But it is not the only way it can be done. For instance, both parties could agree on inspecting the property before they conclude their deal. By doing that, all the tasks will be delegated before. That way, all the unpleasantries can be prevented from happening. Involving a lawyer in this deal can surely shine a light on a lot of the questions.

Other Sorts of Leases


Now, we would like to explain other sorts of Ns out there.


The first type we would like to talk about is a single net, which is often called just N. We can see that this one is not as popular as other sorts. The obligation established by this kind of pact consists of the landlord providing the small risk to occupants. At the same time, residents are obligated to pay all the levies. In case when occupant fails to make a payment, the landholder will be held responsible.


NNs have become quite prevalent in marketable real estate. All the preservation of the property is handled by the possessor. At the same time, the occupant needs to cover all the expenditures. Since this approach is more popular among commercial real estate, the owner will assign the proper amount of tax to the occupant based on the space.

What are the Benefits of NNN?


In the end, we would like to discuss the benefits of NNN.

1.  Long-Term Deal

We’ve mentioned that NNNs last more than ten years. However, that doesn’t mean that they can last more than twenty years. It all depends on the agreement between the two parties. Therefore, we would say that the longevity of this kind of deal is surely its greatest benefit.

2.  Preventing Charges Surge

In case some expenses rise over the years, the tenant is not the only one who will need to be responsible for them. At the same time, the owner will need to cover these increased expenses to a certain capacity. So, you can see that the occupant is not the only one who needs to pay for these.

3.  Transferable Leases

One of the most important benefits you can expect from this kind of deal is the ability to transfer the leases. That means that they can be transferred between proprietors, and there is no limitation to how many times this can be done, even when we are talking about commercial real estate.

The Bottom Line

When we’re discussing NNNs, we can all agree that this is a beneficial approach, but it needs to be concluded in the best possible way for both parties. Here, you can find all the crucial information about it, and what are the responsibilities of both owner and renter.