Quote · BiggerPockets Real Estate Podcast
I Started Investing with Just $7,500. Now I Own Millions in Rentals
Where this was said
Triple Net Leases Explained: Passive Income With No Surprise Bills
At 30:40 · chapter starts 30:00
For listeners unfamiliar with commercial lease structures, Dave Meyer asks Remington to explain triple net leases from first principles. The answer is revelatory for residential investors: unlike owning a house where you're responsible for every repair and tax bill, in a triple net lease the tenant absorbs all those costs [1] — Remington Lyman "In a triple net lease, the tenant pays ALL property expenses — taxes, repairs, maintenance, every bill. For Remington, this meant predictab…" 30:00 . Property taxes, maintenance, insurance, every bill — it all goes to the tenant. The landlord collects a relatively predictable check month after month with almost no surprise expenses. The tradeoff, as Dave notes, is that you're essentially betting on the business occupying the space: a thriving tenant means smooth income; a failing one means potential vacancy. But with a well-vetted, long-term tenant locked into a 10-year lease, the risk-reward is compelling.
By buying his commercial warehouse in a designated Opportunity Zone, Remington can sell after 10 years and pay zero federal capital gains tax on the investment gains.
In a triple net lease, the tenant pays ALL property expenses — taxes, repairs, maintenance, every bill. For Remington, this meant predictable monthly cash flow with almost no surprises, making it far easier to underwrite than residential rentals.
By placing his commercial warehouse in a designated Opportunity Zone and holding for 10 years, Remington will owe zero federal capital gains tax when he sells. Ohio also offers a state-level tax credit of 10% of purchase and renovation costs — benefits he didn't fully capture early on, costing him hundreds of thousands.
