This arrangement centers on a property leased to a single occupant under a triple net (NNN) lease agreement. The tenant assumes responsibility for property taxes, insurance, and maintenance costs in addition to rent. For example, a large corporation might lease an entire office building from a real estate investment trust (REIT) under these terms, managing all operational expenses directly.
Its significance stems from predictable income streams for the landlord and operational control for the tenant. Historically, this structure has been favored by entities seeking long-term stability in property investment and those requiring substantial autonomy over their leased spaces. Benefits include minimized landlord involvement in day-to-day operations and a hedge against rising operating costs for the tenant.
