Net Lease Properties a Hot Commodity Due to Low Yields on Alternative Investments
Today a 10-year government bond would yield a return of approximately 1.5 percent, while a net lease building offers returns from 5 percent to 8.5 percent or greater. There is also little risk associated with class-A net lease properties—as long as the location is good and the building is well-maintained there will always be tenants willing to sign leases even if the existing occupant leaves. This inspires greater confidence in conservative investors than the recently volatile stock market.
Plus, net lease properties rarely require intensive management since the majority of them are leased on a triple-net basis, with the landlord bearing no responsibility for the structure.