Real Estate Investment Solutions
Published on May 24, 2012
Whether a client's real estate purchase is motivated by tax deferral or real estate diversification, the benefit from this section is its focus on the fundamentals of real estate analysis, investment, and ownership. This section will equip investors with the essential aspects of investment real estate and help them identify the types of investments that are right for their particular needs and objectives.
Real Estate Ownership Types: This article addresses the three most common forms of legal real estate ownership as well as the rights and tax consequences associated with each manner of holding title. It is important to distinguish between the different ownership types, as each carries significantly different risks and potential returns.
Real Estate Investment Structures: This article primarily focuses on the different types of legal investment structures that investors utilize to participate in real estate ownership. Each investment structure is broken down in detail regarding 1031, 721, and 1033 exchange compatibility, diversification potential, control, minimum required investment, third party management, and asset manager profit participation.
NNN Properties: This article deals briefly with the current state of the economy and the particularly stable, recession-resilient returns of certain types of NNN investments as compared to other asset classes of real estate. This article delves into the primary aspects of NNN properties and weighs both the general benefits and drawbacks of this asset class.
Corporate Credit Ratings: This is a brief description of corporate credit ratings and their role in helping investors make solid investment decisions.
What to Look For in NNN Properties: This article breaks down some of the most important elements of locating suitable real estate investments by helping the client examine the 1) location, 2) asset, 3) tenant, 4) lease, and 5) ownership structure of investment real estate. While this article is applied specifically to long-term, triple-net leased property, each of these five elements can be applied to nearly any asset class of real estate to help an investor perform more comprehensive investment research and analysis.
Analyzing Lease Terms: This article covers lease obligations, the balance of tenant and landlord rights and liabilities, the necessity of "lease bumps," renewal options, and the issues regarding early termination and co-tenancy clauses. By the end of this article, the investor should be better equipped to identify or even negotiate the right types of leases.
NNN Property Investment Selection: This article provides a summary description of many of the major categories of NNN property, including necessity retail, fast food, gas stations, vehicle repair, etc. Stronger tenant selections are highlighted within each category summary.*
*A full NNN property tenant/property profile spreadsheet is available upon request.