{"id":1004210929,"date":"2018-03-21T05:23:23","date_gmt":"2018-03-21T13:23:23","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004210929"},"modified":"2022-12-09T01:17:43","modified_gmt":"2022-12-09T09:17:43","slug":"when-should-you-trade-your-triple-net","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/when-should-you-trade-your-triple-net\/","title":{"rendered":"When Should You Trade Your Triple Net?"},"content":{"rendered":"<p>By Max Freedman, Managing Director, Sands Investment Group<\/p>\n<p><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg\"><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004210931\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/when-should-you-trade-your-triple-net\/maxfreedman-2\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg\" data-orig-size=\"2402,2437\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;2.8&quot;,&quot;credit&quot;:&quot;April Rocha Photography&quot;,&quot;camera&quot;:&quot;Canon EOS 7D&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;1398435675&quot;,&quot;copyright&quot;:&quot;April Rocha Photography&quot;,&quot;focal_length&quot;:&quot;155&quot;,&quot;iso&quot;:&quot;1600&quot;,&quot;shutter_speed&quot;:&quot;0.0004&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;1&quot;}\" data-image-title=\"MaxFreedman\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?w=1009\" class=\"alignright size-medium wp-image-1004210931\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg\" alt=\"MaxFreedman\" width=\"296\" height=\"300\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg 2402w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=296,300 296w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=768,779 768w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=1009,1024 1009w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=1514,1536 1514w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=2019,2048 2019w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=150,152 150w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=300,304 300w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=696,706 696w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=1068,1084 1068w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=1920,1948 1920w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/03\/MaxFreedman-e1521638348166.jpg?resize=414,420 414w\" sizes=\"auto, (max-width: 296px) 100vw, 296px\" \/><\/a>Most investors buy <a href=\"https:\/\/www.commercialsearch.com\/news\/net-leases-staying-power\/\">triple-net investment properties<\/a> as a long-term hold. What is often overlooked is the exit strategy. When to sell an asset may be the biggest decision an investor makes. Key events within the hold period can help indicate it\u2019s time to sell.<\/p>\n<h2>The Market<\/h2>\n<p>All investors look to buy low and sell high. That\u2019s why timing is everything with any investment because no one wants to \u201cmiss the market.\u201d In a seller\u2019s market, many investments see unrealized gains through\u00a0cap rate compression in the marketplace. We are now experiencing some of the lowest\u00a0cap\u00a0rates the triple-net market has ever seen. The additional equity is attributed to the market and this gain can be used to trade up. Investors should seek to increase their position through quality of real estate, credit and lease term. This is the time to use the market to its advantage, unlock the built up equity and reinvest into a stronger investment position.<\/p>\n<h2>Lease Term<\/h2>\n<p>Lease term is king when valuing net-lease investments. The length of term on the lease is directly correlated with the investor\u2019s risk tolerance on the guaranteed rent, thus affecting the rate of return the investor is willing pay. The tipping point where investors see the premium is at the 10-plus year mark. To increase position, investors can capitalize on the hold period rent increases and reset the clock on a long-term investment. Investors should consider trading while the asset is in its premium lease term and look for an investment with a long-term lease to reset the clock<\/p>\n<h2>Credit Upgrade<\/h2>\n<p>Credit plays a big role in the risk tolerance for investors seeking net lease investments. The stronger the credit behind the lease the lower the yield for the investor. If a large corporation assumes responsibility of a lease in a buyout or assumption, this focal point in the investment strategy is the time to consider a trade.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>While most investors buy triple-net assets as a long-term hold, they often overlook the exit strategy, notes Sands Investment Group Managing Director Max Freedman.<\/p>\n","protected":false},"author":1608,"featured_media":1004210931,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[23891,21684],"tags":[34440,33239],"class_list":["post-1004210929","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-national","category-viewpoint","tag-sands-investment-group","tag-triple-net-lease"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>When Should You Trade Your Triple Net? 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