“Century’s professionalism, commitment and follow through were exceptional. We have been exposed to other players in this industry that did not give us the same good feeling that we received when we met with Century. We are happy to be involved with a quality partner and are looking forward to future dealings.”
- Denny Kaczmarek, Therm-All, Inc.
What is a net lease? In commercial real estate, a net lease requires the tenant to pay, in addition to the rent, most or all of the property expenses which may normally be paid by the property owner/landlord in other types of leases. These property expenses may include real estate taxes, insurance, maintenance, and other items. (The property owner receives the rent “net” after the expenses that are to be paid by the tenant.)
What is a triple net lease (NNN lease)? A triple net lease agreement stipulates that the tenant is responsible for maintenance, taxes, insurance. There are various forms of triple net leases, such as an absolute NNN lease (tenant bears 100% of all responsibilities) or triple net leases where the property owner retains minimal responsibilities (such as roof and structure).
Virtually all of the real estate Century acquires for its various investment offerings is single tenant, net lease properties (and almost always triple net lease). Therefore, Century properties are 100% occupied (because of the single tenant component) with minimal or no landlord responsibilities (enabling the vast majority of the rental income to pass through to the investors). Compared to real estate investments with full service or other leases, triple net leases provide the property owner (here, the investors in a particular Century offering) with the peace of mind that when maintenance needs arise, the tenant bears the responsibility. Additionally, if property tax or insurance rates increase, the property owner’s income remains steady. We have come to greatly value the predictability and consistency that net lease properties provide year after year.