Leases
NNN (Triple Net)
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Also called: triple net · triple net lease · nnn
NNN is the most widely used net-lease structure in single-tenant retail and industrial real estate: "triple" refers to taxes, insurance, and CAM, all billed back to the tenant on top of base rent. Most NNN leases still leave roof and structural repair with the landlord — that additional shift is what distinguishes an NNN lease from an absolute NNN lease.
Because NNN shifts most operating cost volatility to the tenant, it produces a more predictable, bond-like income stream for the landlord, which is why NNN structures dominate single-tenant net-lease investment sales and trade on tenant credit and lease term rather than building condition.
The recurring diligence point for a buyer underwriting an NNN deal is confirming what the lease actually says the landlord retains — labels vary by broker and by region, so "NNN" in one lease can carry different landlord obligations than "NNN" in another, and that gap directly affects the landlord's real net income.
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Terms that travel with this one
- Absolute NNNA lease structure where the tenant is responsible for all property expenses, including roof and structure, leaving the landlord with a purely passive income stream.
- NN (Double Net)A lease where the tenant reimburses two of the three nets — property taxes and insurance — but not common area maintenance, which the landlord retains. CAM is the line that separates NN from NNN.
- Cap RateCapitalization rate — a property's net operating income divided by its purchase price or value, used as the primary shorthand for pricing and comparing income-producing real estate.
- Ground LeaseA long-term lease of land alone, under which the tenant typically constructs and owns the improvements for the lease term, with the land and improvements reverting to the landowner at expiration.
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Applying NNN (Triple Net) to a real deal
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