Day 6: The Tenant Is the Investment

In a triple-net, or NNN, investment, the tenant is a major part of the asset. Before moving forward, review the tenant’s creditworthiness, financial strength, operating history, and ability to fulfill lease obligations. Confirm whether the lease was signed by a corporation, national company, or small franchisee, then identify every guarantor and the scope of each guarantee. Finally, check the years remaining on the lease, including renewal options and rent escalations. Common NNN tenant categories include pharmacies, quick-service restaurants, auto parts stores, banks, grocery stores, and dollar stores. Use this checklist for education and consult qualified professionals before investing.