Single-tenant net lease research identifies freestanding commercial properties occupied by a single tenant under a net lease structure. STNL assets are favored by 1031 exchange investors for their simplicity, predictable cash flow, and minimal management burden, particularly when the tenant carries an investment-grade credit rating and the property clearly qualifies as like-kind real property.
We source STNL opportunities across retail, industrial, and office sectors, filtering by tenant credit quality, remaining lease term, annual rent escalations, and landlord obligations. Each candidate is analyzed for cap rate relative to tenant risk, re-lease probability at expiration, and underlying real estate value independent of the current lease before it is placed on your identification list.
STNL properties offer the closest thing to passive income in commercial real estate, but overpaying for a short remaining lease term or a weakening tenant credit profile can turn a safe investment into a problem asset well before the loan matures.
Asset focus
Challenges
- Overpaying for a short remaining lease term or a weakening tenant credit profile can turn a safe-looking STNL investment into a problem asset.
- Cap rate alone does not capture re-lease probability at expiration, which is often the more important risk factor in a single-tenant deal.
- The underlying real estate value independent of the lease is easy to overlook when a property is priced primarily off the tenant's credit.
- STNL inventory moves quickly in competitive markets, and a slow diligence process can cost you the strongest candidates.
What we deliver
- A screened list of STNL candidates across retail, industrial, and office sectors by tenant credit and lease term.
- A cap rate analysis relative to tenant risk and remaining lease duration.
- A re-lease probability assessment at expiration for each candidate.
- An underlying real estate value analysis independent of the current lease.
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FAQ
What sectors does STNL research cover?
Retail, industrial, and office, filtered by tenant credit quality, remaining lease term, annual rent escalations, and landlord obligations under the lease.
Why is tenant credit rating so central to STNL underwriting?
With a single tenant, the entire income stream depends on that tenant's ability to pay, so credit quality drives cap rate and financing terms more than almost any other factor.
What is re-lease probability and why does it matter?
It is the likelihood a space re-leases smoothly at or before expiration. A short remaining lease term on a weak-credit tenant lowers re-lease probability and increases risk at the current price.
Does the underlying real estate value matter separately from the lease?
Yes. We evaluate the real estate's value independent of the current lease, since a strong location retains value even if the tenant vacates at expiration.
Is STNL truly passive?
It is close to passive when the tenant carries an investment-grade credit rating and the lease is structured as true triple net, but landlord obligations still vary by lease and should be reviewed carefully.
How quickly can STNL candidates be sourced?
We maintain active broker relationships across retail, industrial, and office STNL, which lets us move quickly to fill your identification list within the 45-day window.