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Updated about 4 years ago,
Triple net lease with replacement rent
I'm brand new to the commercial space so I'm just trying to learn a few things. I recently found a commercial property that has a NNN lease with a 100 year ground lease with 84 years remaining and it states that it has replaceable rent at $5.50 PSF. What exactly does the replacement rent mean? Does this mean I can potentially raise the rents by $5.50 PSF? The asking price is 400k at a 4.46% cap rate.