| The Lease Structure That Generates the
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| | insurance, and utilities. A true triple
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| Most Cash for Your Commercial
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| | net lease is one in which the lessee pays
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| PropertyCommercial properties are
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| | all of the operating expenses, and the
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| characterized through income generated by
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| | lessor simply receives a rent check every
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| rents paid by tenants. These commercial
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| | month.This structure of leasing has
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| properties can be apartment complexes,
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| | become very popular, and many commercial
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| office buildings, strip malls, retail
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| | properties are making the switch because
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| centers and medical buildings.The more
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| | it greatly decreases the overall
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| income a commercial property can produce,
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| | expenses, net operating income, and make
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| the more valuable it is. The true
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| | the property higher performing and
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| qualifying factor is the net operating
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| | extremely more valuable. The lessors may
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| income, or NOI, which is income minus
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| | not be happy, as they are now required to
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| operating expenses. Operating expenses
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| | pay for the entire property, as opposed
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| include any expense that relates to the
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| | to just their living space.So how does
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| actual operations of the property. These
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| | the lessor know how much each lessee must
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| can include taxes, utilities,
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| | pay? Besides separating the utilities and
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| maintenance, and management costs.It used
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| | having each unit's tenant be responsible
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| to be common for the owner to pay the
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| | for that which he or she uses, the common
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| property's taxes, insurance, and
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| | expenses are divided among all the units
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| utilities under a full service lease. The
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| | according to the total square footage of
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| tenant would simply pay the rent every
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| | living space. The larger the unit leased,
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| month, and the owner would pay the bills.
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| | the more they pay.In order to put this
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| This greatly cut into overall profits, as
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| | triple net lease structure into place,
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| the owner was using rent income to pay
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| | and see your income drastically increase,
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| the additional bills.Savvy commercial
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| | simply put a clause in the contract that
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| property owners and investors soon came
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| | the lessee is to pay the operating
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| to realize that if the tenants are using
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| | expenses which will be divided on a
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| the property, then they should have to
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| | pro-rata share, based on square footage
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| pay for the expenses of keeping it in
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| | usage. Under this lease, the tenant
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| operation. After all, who is using the
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| | literally pays all common area
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| water, electricity, trash services and
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| | maintenance which may include parking lot
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| common areas? Not the owner, but the
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| | cleaning, parking lot's electric, the
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| tenant.Net leases became popular, instead
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| | lawn care, pool maintenance, and all
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| of the full service lease, which required
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| | other utilities used by the project.If
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| the lessee to pay only the taxes and
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| | you feel that your property could better
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| insurance. The lessor would be
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| | perform by implementing a triple net
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| responsible for utilities and other
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| | lease structure, then speak to your
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| related operating expenses. This change
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| | lawyer or advisor about rewriting the
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| in lease structure allowed more profit to
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| | contracts to include the triple net lease
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| stay in the hands of the owner.Even
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| | clause. Watch your expenses drastically
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| still, owners took the lease structure
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| | decrease, and you income rise
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| one step further. In recent years, and
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| | quickly.Tony Seruga, Yolanda Seruga and
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| even recent months, both young and old
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| | Yolanda Bishop of specialize in
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| properties are being changed to
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| | commercial and investment real estate.
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| net-net-net leases, or the triple net
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| | As of May, 2006, they and their partners
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| lease, where the lessee (tenant) is
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| | are managing over $600 million dollars
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| responsible for paying three of the most
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| | worth of new projects.
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| important operating expenses: taxes,
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