What is a NNN Lease?

The following ratings and probability estimates provided for general information purposes only and should not be relied on without further verification.

representative photo of Dollar General, NNN, STNL, NAI

representative photo of Dollar General, NNN, STNL, NAI

Bldg representative of typical KFC, NNN, Dreznin, Real Estate Done Right

Bldg representative of typical KFC, NNN, Dreznin, Real Estate Done Right


TENANT CREDIT RATINGS
& PROBABILITY OF DEFAULT

TENANT
STOCK SYMBOL
STANDARD & POORS PROBABILITY OF DEFAULT (5 YEARS)
MOODYS PROBABILITY OF DEFAULT(5 YEARS)

7-Eleven
SE AA- 0.20% Baa3 4.00%

**************************************************
Advance Auto
AAP BBB- 4.00% Ba1 7.00%

**************************************************

AutoZone
AZO BBB 2.00% Baa2 2.00%

**************************************************

Bank of America
BAC A 0.60% A2 0.60%
**************************************************

Barnes & Noble
BKS NR –
Ba2 9.00%

**************************************************
BB&T
A 0.60% A1 0.40%

**************************************************

Brinker Intemational
EAT BBB- 4.00% Ba1 7.00%

**************************************************

Burger King Corp.
BKC BB- 19.00% Ba2 9.00%

**************************************************
Capital One Financial Corp
COF BBB+ 1.50% Baa1 1.50%

**************************************************
Carrols Corp/Carrols Restaurant Group Inc
TAST B 31.00% –

**************************************************

Circle K (Alimentation Couche-Tard)
ANCUF BB+ 7.00% NR –
**************************************************
Citibank
C A+ 0.40% A1 0.40%
**************************************************
CKE Restaurants
CKR BB- 19.00% Ba3 19.00%
**************************************************
CVS
CVS BBB+ 1.50% Baa2 2.00%
**************************************************
Darden Restaurants
DRI BBB 2.00% Baa3 4.00%
**************************************************
Denny’s Inc.
DENN NR –
Ba2 9.00%
**************************************************
Dollar General
DG BBB- 9.00% B1 25.00%
**************************************************
Dollar Tree
DLTR –
**************************************************
Exxon Mobil
XOM AAA 0.15% Aaa 0.15%
**************************************************
Family Dollar
FDO –
**************************************************
FedEx
FDX BBB 2.00% Baa2 2.00%
**************************************************
Fifth Third Bancorp
FITB BBB 2.00% –
**************************************************
Food Lion (DelhaizeAmerica)
DEG BBB- 4.00% Baa3 4.00%
**************************************************
Fresenius Medical Care AG
FMS BB 9.00% Ba1 7.00%
**************************************************
Fresh & Easy
TSCO A- 0.60% A3 0.60%
**************************************************
Goodyear Tire & Rubber Company
GT BB- 19.00% Ba3 19.00%
**************************************************
Hhgregg
HGG B+ 25.00% Ba3 19.00%
**************************************************
Home Depot
HD BBB+ 1.50% Baa1 1.50%
**************************************************
J.P. Morgan Chase & Co.
JPM A+ 0.40% Aa3 0.20%
**************************************************
Jack in The Box
JBX BB- 19.00% Ba3 19.00%
**************************************************
Key Bank
KEY BBB+ 1.50% Baa1 1.50%
**************************************************
KinderCare (Knowledge Learning Corporation)
KLC NR –
B1 25.00%
**************************************************
Kohl’s Corp.
KSS BBB+ 1.50% Baa1 1.50%
**************************************************
Kroger
KR BBB 2.00% Baa2 2.00%
**************************************************
Lowe’s
LOW A+ 0.40% A 0.40%
**************************************************
McDonalds Corp.
MCD A 0.60% A3 0.60%
**************************************************
Men’s Wearhouse
MW –
**************************************************
Office Depot
ODP B 31.00% B2 31.00%
**************************************************
Office Max
OMX B- 43.00% B1 25.00%
**************************************************
O’Reilly Auto Parts
ORLY BBB-
**************************************************
Pep Boys
PBY B- 43.00% B2 31.00%
**************************************************
Petsmart
PETM BB 9.00% NR –
**************************************************
PF Chang’s China bistro
PFCB –
**************************************************
PNC Bank
PNC A+ 0.40% A1 0.40%
**************************************************
Publix
A 0.60% –
**************************************************
RBC Bank
RY A- 0.60% A1 0.40%
**************************************************
Red Robin Gourmet Burgers
RRGB –
**************************************************
Rite-Aid
RAD B- 43.00% Caa2 60.00%
**************************************************
Safeway
SWY BBB 2.00% Baa2 2.00%
**************************************************
Sherwin-Williams
SHW A- 0.60% A3 0.60%
**************************************************
Staples
SPLS BBB 2.00% Baa2 2.00%
**************************************************
Starbucks
SBUX BBB+ 1.50% Baa3 4.00%
**************************************************
Supervalu
SVU BB- 19.00% Ba3 19.00%
**************************************************
US Bancorp
USB A+ 0.40% Aa3 0.20%
**************************************************
VCA Veterinary Hospital
WOOF BB 9.00% Ba2 9.00%
**************************************************
Verizon
VZ A 0.60% A3 0.60%
**************************************************
Wachovia Corp
WB NR –
A1 0.40%
**************************************************
Walgreen Co
WAG BBB+ 0.60% A2 0.60%
**************************************************
Wal-Mart
WMT AA 0.20% Aa2 0.20%
**************************************************
Wells Fargo
WFC AA- 0.20% A1 0.40%
**************************************************
Wendy’s/Arby’s Group
WEN B+ 25.00% B2 31.00%
**************************************************
Whole Foods
WFMI BB- 19.00% Ba3 19.00%
**************************************************
Yum! Brands
YUM BBB- 4.00% Baa3 4.00%
**************************************************-

What is a NNN Lease?
In a triple-net lease (NNN), the tenant pays all the operating expenses, property taxes, utilities, insurance premiums, maintenance and repairs. The landlord gets to collect monthly net rental income just as he or she would with a traditional real estate investment. Such a lease usually extends over the long term, with a financially strong corporate entity guaranteeing a lease anywhere from 10-25 years.

Example:
Wendy’s is your tenant for a guaranteed 20-year period. The tenant is responsible for all costs to operate and maintain the property, this is sometimes referred to as an “absolute” Triple-Net lease because the only management required is paying the mortgage (if there is one) and receiving the rent checks. Triple-Net lease ownership is great for first-time real estate investors as well as for long time investors seeking purchase or trade into less complicated real estate investments. In many cases, when the lease expires, you will own the property free and clear.

The price range for a NNN lease property is generally between $1 million – $7 million. The fast food restaurants and auto stores and are the most affordable, while drugstores are on the higher end. Big box retailers such as Home Depot, Lowe’s, and Publix can bring from $15 million to $25 million.

Contact Sean Dreznin and Phil Ginexi at NAI Investment Properties to BUY or SELL your NNN property. Whether it’s a Free-standing, combined property (Taco Bell & Long John Silvers or Dairy Queen and Baskin Robbins), Single Net, NN or a 1031 exchange. We handle all aspects of investments, STNL.

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