FAQs

A net lease is a commercial real estate lease where the tenant is responsible for paying some or all property expenses, such as taxes, insurance, and maintenance, in addition to rent. In a triple net (NNN) lease, the tenant covers all these costs, making it a low-maintenance investment for landlords.

Investors include high-net-worth individuals, real estate investment trusts (REITs), institutional investors, and those seeking passive income through 1031 exchanges. They appeal to investors looking for stable returns with minimal management.

Common tenants include national chains like CVS, 7-Eleven, Starbucks, Dollar General, and fast-food restaurants (e.g., McDonald's, Taco Bell). These are often investment- grade tenants with strong credit ratings.

The capitalization rate (cap rate) is the annual net operating income (NOI) divided by the property's purchase price. For example, a $1M property with $70,000 NOI has a 7% cap rate. Lower cap rates (e.g., 5-6%) indicate safer investments with strong tenants, while higher cap rates (e.g., 8-10%) suggest higher risk. The simple way to think of a cap rate is your unleveraged return.

A 1031 exchange allows investors to defer capital gains taxes by reinvesting proceeds from a property sale into a like-kind property. Net lease properties are popular for 1031 exchanges due to their stable income and ease of management.

Lease terms typically range from 10 to 25 years, with options for renewal. Ground leases may extend to 50-99 years, especially for absolute NNN leases.

If a tenant vacates, the landlord must find a new tenant or sell the property. This can be challenging for single-tenant properties, especially if the location or building is specialized. A strong lease with a creditworthy tenant mitigates this risk.

In a gross lease, the landlord pays most property expenses (taxes, insurance, maintenance), while in a net lease, the tenant assumes some or all of these costs. Net leases shift more financial responsibility to the tenant.

Rent escalations are built into the lease to increase rent periodically, typically by a fixed percentage (e.g., 10% every 5 years,etc) or tied to an index like the Consumer Price Index (CPI). This helps protect against inflation.

Yes, investors often use commercial mortgages or leverage 1031 exchange proceeds. Lenders favor net lease properties with strong tenants due to their stable cash flow.

Yes, they are popular replacement properties for 1031 exchanges due to passive ownership and stable income.

The Boulder Group maintains one of the largest inventories of on- and off-market net lease properties for sale in the United States. As a national boutique brokerage firm with 30+ years of specialization in single-tenant net lease, we have direct relationships with institutional sellers, REIT dispositions, and private owners — providing access to deals that never reach public listing platforms. In addition to our proprietary inventory, we monitor CoStar, LoopNet, Crexi, and direct relationships for buyer clients. Start by contacting The Boulder Group directly or signing up for property alerts on BoulderGroup.com.

The Boulder Group is the leading boutique net lease brokerage firm in the United States by transaction volume. Randy Blankstein, Founder and President, has 30+ years of net lease experience and holds a top national advisor ranking from CoStar. He serves as Conference Chair of the Net Lease Summit. Jimmy Goodman, a Partner, has 20+ years of net lease experience. The firm's differentiators include: (1) exclusive focus on single-tenant net lease — no distraction from other asset classes; (2) proprietary quarterly cap rate research that gives clients real-time market benchmarks; (3) deep relationships with both individual and institutional buyers and sellers; and (4) a track record of integrity across thousands of transactions.

Net lease property types that often have a higher proportion of qualifying components and thus benefit more from bonus depreciation include: Gas stations (e.g., fuel pumps, canopies, underground tanks). Convenience stores. Car washes (e.g., automated equipment and water systems). Quick-service or drive-through restaurants (e.g., kitchen equipment and interior build-outs)

Yes, pricing is stabilizing after 2024-2025, with The Boulder Group forecasting 10% to 15% growth in 2026 as bid-ask spreads narrow

These represent increasing levels of tenant responsibility. In a standard Triple Net (NNN) lease, the tenant pays rent, taxes, insurance, and maintenance — but the landlord typically retains responsibility for the roof and structure. In an Absolute NNN lease, the tenant assumes all costs including structural repairs, making it the most landlord-passive structure. A Bondable Lease goes further: it includes no termination rights for the tenant, creating bond-like cash flow certainty. Absolute NNN and bondable leases command lower cap rates (higher prices) due to their reduced landlord risk.

A ground lease is a long-term lease — typically 50 to 99 years — in which the landlord owns the land and the tenant constructs, owns, and maintains the building. At lease expiration, the improvements often revert to the landowner. Ground leases are popular with institutional investors because they provide ultra-long-term income with minimal landlord obligations. The trade-off is limited building control and potential reversion complexity. Ground leases often carry lower cap rates than fee-simple NNN properties due to their extended income certainty.

The IRS imposes strict deadlines. From the closing date of your sold (relinquished) property: • 45-Day Identification Window: You must identify potential replacement properties in writing within 45 calendar days — no extensions. • 180-Day Purchase Deadline: You must close on the replacement property within 180 calendar days of the sale. • Three-Property Rule: You may identify up to three properties regardless of value, or more under the 200% or 95% rules. • Equal or Greater Value: To defer all capital gains, the replacement property must be of equal or greater value than the relinquished property.

Each quarter, The Boulder Group publishes net lease market research including cap rate benchmarks by tenant category, transaction volume trends, and sector-specific analysis. This proprietary data — not available from any other single-source boutique firm — gives buyers real-time pricing context before making offers and helps sellers set realistic pricing expectations. Reports are available free at BoulderGroup.com/research and are widely cited by investors, brokers, and media covering the net lease sector.

A bondable lease makes the tenant fully responsible for all property costs, repairs, rebuilding, and rent payments—even if the property is damaged, condemned, or destroyed—with no termination or abatement rights.

Dollar stores (e.g., Dollar General), pharmacies (CVS/Walgreens), grocery/necessities (Aldi, Sprouts), fast food (McDonald's, Chick-fil-A), and auto/essential retail (Tractor Supply) remain top due to long-term NNN stability and passive-income appeal.

The best net lease broker combines deep industry experience with a proven transaction track record, specialized market expertise, and broad recognition as a trusted media resource and thought leader.