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May 10, 2010

CASHING IN ON A REAL-ESTATE BOOM


Most Commercial Properties Are Slumping, But 'Triple Net Lease' Deals Are Hot

American Realty Capital Trust in Jenkintown, Pa., which is not traded on a stock exchange. These REITs invest mainly in triple-net properties, and they're generally sold through broker-dealers. They sometimes have minimum-net-worth and other requirements.

As with most income properties, investors can come out ahead—or behind—on triple-net properties in two ways: through price appreciation and income. The best measure of income potential is the so-called capitalization rate, or the net operating income divided by the purchase price of a property.

Disclaimer:

Risk Disclosure relating to Triple Net Lease Real Estate Investments: The success of our triple-net-leased properties depends on the financial stability of the tenants, certain losses may be uninsurable or subject to material exceptions, and a default or bankruptcy by the tenant could adversely affect our funds available for future acquisitions or cash available for distributions.

To read the full article, please visit the Wall Street Jounal's website by clicking here


This material does not constitute an off­er to sell nor a solicitation of an off­er to buy any securities described herein or otherwise. Only a prospectus for a specific securities offering makes such an off­er. In that regard, the use of this material is authorized only when it is accompanied or preceded by a prospectus. Further, all information contained in this material is qualified by the terms of a current Prospectus of the off­ering of securities to which it relates, if any.

This material may contain forward-looking statements that involve assumptions, uncertainties and risks, some of which are set forth below. These statements are not guarantees and should not be regarded as representations that the results or conditions described in such statements, or that our objectives and/or plans, will be achieved.

A real estate investment program offering is subject to the following Risks: The failure to qualify, or maintain the requirements, to be taxed as a REIT would reduce the amount of income available for distribution and limit a REIT's ability to make distributions to its stockholders. No public market initially exists for a REIT's shares of common stock, and one may never exist for this or any other such type of real estate program. Securities are being offered on a best efforts basis. These are speculative securities and as such involve a high degree of risk. There are substantial conflicts among an offering and its sponsor, advisor, dealer manager and property manager. There is no assurance that the value of the real estate will be suffi­cient to return any portion of investors' original capital. Operating results will be affected by economic and regulatory changes that have an adverse impact on the real estate market and we cannot assure you that there will be growth in the value of the properties.


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