Ep 134: Investing in a Triple Net Lease Property with Dwaine Clarke

How would you like to own a Taco Bell, 7-Eleven or Dollar General? We’re not talking about running a franchise or branch, but investing in single tenant net lease properties, otherwise known as a triple net lease. Dwaine Clarke focuses on triple net leases and has completed over $150M in transactions since 2012. He shares some of the differences in investing in triple net lease properties compared to multifamily, how to conduct market research, and how to evaluate credit risk for these retailers.

 

Partner: Download a Free Sample Apartment Deal Package

 

 

Key Insights

• Large companies often lease retail locations and cover all expenses and taxes
• Commercial leases are long term – 15-30 years with renewals built-in
• Downside: minimal upside and only one tenant
• Mitigate risks by selecting great locations with high traffic, strong jobs, and solid household income
• Places where e-commerce is less of a threat (hair salons, entertainment, etc.)
• Monitor retail settings – high traffic, highway visibility, population, and household income
• Lower return expectations with 4% – 6.75% cap rates
• Ideal for investors not interested in real estate or with a lower risk tolerance
• Corporate, Institutional, Franchise levels of commercial
• Corporate – privately-owned, but large firms; Institutional – publicly traded, large firms; Franchise – smaller, privately-owned
• S&P, BBB, Moody’s resources to check credit rating and credit profile
• When a tenant leaves, the new tenant is usually responsible for the build-out of the new space

 

 

Bull’s Eye Tips:

How has a failure or apparent failure, set you up for later success?

Started flipping houses and did not go well

 

Most Recommended Book:

Winning Through Intimidation by Robert Ringer

 

Million Dollar Habits by Robert Ringer  

Most Recommended Digital/Mobile Resource:

Asana

 

Daily Habit

Waking up between 4 – 4:15am

 

Wish I Knew Last Year

Networking on a high level – traveling for event, podcasting

 

Real World Advice

Be ready to adjust and subscribe to audio university

 

Advice to Ignore

The negative people

 

Current Curiosity

Learning more and being open – parenting and family relationships

 

Best Place to Grab a Bite

Bar Taco & Flemings – West Hartford, CT

 

Resources:

Free Copy of Real Estate Mailbox Money

 

Connect with Dwaine:

Social Media: Dwaine Clarke

 

Website: BuyNNNProperties.com

 

 

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