An Investor’s Guide to Buying Ashley Furniture NNN Leases

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You are about to make the biggest investment of your lifetime. Buying Ashley Furniture stores may seem like a complex investment vehicle, but they are in fact quite simple. The company’s triple net lease (NNN) properties have been around for many years and have been an excellent investment choice for many investors over time.

In this article, we will give you some tips on how to buy Ashley Furniture NNN leases and help you get started with this lucrative asset class.

About Ashley Furniture

Officially known as Ashley Furniture HomeStore, this company is a manufacturer and distributor of furniture and bedding products in the US and around the world, ranking internationally as a top furniture brand with in-demand products. Since its establishment, the company has been experiencing continuous expansion with 450 locations in North America and 70 more outside the country.

Considering its growth, buying Ashley Furniture NNN leases is one of the best investment decisions that you can make to build wealth and achieve financial freedom.

Ashley Furniture Properties

Typically, the building size of Ashley Furniture stores consists of 30,000 to 54,000 square feet, surrounded by an average acreage of 2.5 to 5.5 acres of land. The standard leasing structure would include a 15-year NNN lease, with a rental increase that ranges from 7.5% to 10% every five years. However, rental increase terms could be changed on an annual basis.

Generally speaking, the perks that you will enjoy from owning an Ashley Furniture property are:

  • Standard 15-year NNN structure – This means that you will have a steady income stream for the long term.
  • Top-rated brand – This means that your products will be sought out by customers locally and even internationally.
  • No landlord accountability – This means that you will have less responsibility in maintaining and managing the property, as this will fall into the hands of the tenant.

As Ashley Furniture properties are not subject to typical net leasing property accountability, they are normally run by franchisees rather than directly operated from the corporate level.

Ashley Furniture stores for sale would cost up to around $1,500,000 with a cap rate of 6.25%.

To know more about their properties, you can view Ashley Furniture NNN leases that you can just find online.

Important Considerations When Buying Ashley Furniture Stores

As previously implied, most Ashley Furniture real estate for sale comes as NNN leases. As such, there are things that you should keep in mind when buying such properties.

1. Have a solid understanding of the Ashley Furniture brand.

Ashley Furniture is a well-known and trusted brand with a large customer base. This means that you can be confident that there will always be demand for their products, regardless of the current economic conditions. This is important to keep in mind when buying an Ashley Furniture store as it gives you an assurance that your investment will not depreciate over time.

2. Have a full understanding of what an NNN lease is.

An NNN lease is a commercial real estate lease agreement in which the tenant (in this case, Ashley Furniture) agrees to pay all or most of the expenses related to the ownership of the property. These include rent, property taxes, insurance, and maintenance costs.

This type of lease is attractive for both landlords and tenants alike as it removes much of the burden from each party. The landlord does not have to worry about managing the property or being liable for any damages that may occur, while the tenant enjoys tax breaks and predictability in their rent payments.

Since Ashley Furniture properties are usually offered as NNN leases, it’s important that you fully understand what this means before making an offer. If you’re not comfortable with the idea of being responsible for all property-related costs, then this is a great investment for you.

3. Choose a great location.

One of the things that NNN Ashley Furniture stores are known for is their high-traffic locations. However, there are those which are more ideally located than others. As such, when buying an Ashley Furniture property, it’s important to make sure that the location is desirable and will attract a lot of customers.

You can easily determine this by looking at the company’s website or even going to one of their stores in person. Doing so will give you an idea of what kind of clientele they cater to and whether or not the surrounding area has potential for growth.

Remember that as a landlord, you want your tenant’s business to thrive so that you can continue receiving rent payments for years to come. So, before making any offers, be sure to do your due diligence and research on the store’s location.

4. Look for ones with a high cap rate.

When it comes to Ashley Furniture leases, the cap rate is one of the most important factors to consider. This is simply the annual return that you can expect on your investment and is calculated by dividing the property’s net operating income (NOI) by its purchase price.

Ideally, you’ll want to look for stores with a high cap rate as this means that you’re getting a good return on your investment. You can find these properties by searching online or through commercial real estate listings.

To calculate a potential property’s cap rate, you can use this formula:

Cap Rate = Annual Net Operating Income / Purchase Price

5. Inspect the property yourself.

Although it’s not always possible, it’s always a good idea to inspect the store that you’re interested in yourself. This will give you an idea of the condition of the property and whether or not there are any repairs that need to be made.

It’s also a good opportunity to meet with the current tenant and get their opinion on the business. By doing so, you’ll be able to get a sense of how well the store is doing and whether or not they plan on renewing their lease agreement when it expires.

6. Seek the advice of an NNN expert.

If you’re not familiar with Ashley Furniture triple net lease or with this type of lease in general, it’s always a good idea to seek the advice of an expert. This way, you can be sure that you’re making a wise investment and aren’t missing any important details.

There are many commercial real estate professionals who specialize in triple net leases, so don’t hesitate to reach out for help.

Final Thoughts

Buying Ashley Furniture NNN leases can be a great way to invest in a high-quality, top-rated brand. Not only do you enjoy the stability and predictability of a standard 15-year lease agreement, but you also have less responsibility when it comes to maintaining and managing the property. 

With Ashley Furniture’s continuous growth, their stores are sure to continue to be popular investments for years to come. So, if this is something that interests you, be sure to keep an eye out for Ashley Furniture real estate for sale!

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