What cash on cash would you accept for a low IRR?

[Neil Cronkrite]

I've been underwriting deals this week where cash on cash exceeds 12%, but the IRR on a 5 year old is around 10%. This would be an absolute triple net lease outpatient surgical center. For those who have invested (or thinking about investing in syndications), especially NNN triple net lease properties, what are your thoughts? I know it will be depend on lease length, tenant type, asset age, and location, but I'm curious how LP passive investors are navigating syndication are navigating investing in this environment.

[Matthew Drouin]

@Neil Cronkrite why is the IRR lower than the COC? Usually it's the other way around. Are you expecting the cap rate to go up on an exit or refinance?

12% on a triple net outpatient surgical center seems pretty good.  Medical office tenants are pretty sticky.

What's the duration on the current lease?