Dale Washburn on Real Estate

With Certificates of Deposit and Treasury Instruments paying interest at record lows, consider investing in buildings that are leased to corporate tenants such as Family Dollar, Dollar General and O ‘reilly’s Auto Parts.

These companies are growing and are opening new locations in buildings that are leased from private owners. The new leases are ten to twenty years long and have little risk for the landlord.

Usually, the tenant is responsible for paying the taxes and insurance on the building as well as making all repairs to the building with the exception of the roof. If the building is new or has had the roof replaced recently, the risk of needing  a major roof repair is small.

These buildings can be purchased at prices that will yield an annual rate of return of from 7 % to 10 % depending on the length of time remaing on the lease. Many of these leases will have options for the tenant to extend the lease for successive periods of  five years.

Long term leases to tenants with a solid credit rating, little responsibilty for maintenance and a yield that is four times greater that what is available in Certificates of Deposit make this an idea that is worth pursuing.

Call me at 478-320-5773 or e mail me at dale@dalewashburn.com for more information on available properties.