Debate: Are triple net leases actually worth it for small landlords?

I had a conversation with a guy at a REIA meetup in Austin last month that still has me thinking. He owns three small strip mall units and swears by NNN leases because he hates dealing with roof repairs and parking lot resurfacing. But I brought up a property I almost bought in 2021 where the tenant practically ran the place into the ground because the landlord had no incentive to check on anything since repairs passed through. With cap rates getting squeezed, which side do you lean on for smaller multi-tenant buildings? Has anyone else had a tenant totally neglect maintenance under a NNN where you ended up regretting the structure?

2 comments

2 Comments

lucas_price8310d ago

Doesn't this remind you how buying a car with a warranty makes you care less about changing the oil?

elliotw3710d ago

Nah, a warranty just covers breakdowns, not neglect.