What are some pros & cons of a NNN vs Gross lease agreement?

[Evan Glasco]

Hey guys, I’m brand new to BP. What an amazing resource. So my company owns and manages multi tenant industrial complexes and a mini storage. We currently have 125 tenants, all on GROSS leases. It certainly produces positive cash flow, however the maintenance can be a bit pricey. I am looking into investing more into residential properties (duplexes, apartment complexes etc.).

My question, what if any are the benefits to having my residential (and potentially my commercial) tenants sign a NNN lease as opposed to a GROSS lease? I'd assume it's less of an upfront cash flow but may pay off in the long run? Any issues with in forcing the tenant to pay for the triple net costs? Thanks