Single Tenant Net Lease (NNN) – Investment & Valuation Model

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Single-tenant property is a property that is fully occupied by a single user. Single-tenant properties often feature a triple-net (NNN) lease structure and generally have remaining lease terms of at least 10 years. Single-tenant, net-leased properties, which sometimes use the acronym STNL, can be attractive to individual investors due to their low management responsibilities, predictable cash flow, and often long lease terms.

This Financial model presents n investment scenario for a Single Tenant Net Lease Property and contains the basic elements required to determine a range of possible IRR returns to an investor, given a high-level set of assumptions about the asset’s operating forecasts, leverage, and exit price.

The structure of the template follows Financial Modeling Best Practices principles and is fully customizable.

Model Structure

• General Setup & Acquisition Inputs
Investment-related inputs including Property Metrics, Timing, Acquisition and Sale Assumptions, Renovation Budget, Rental & Opex Assumptions and Financing through Equity and 2 Loan types.

• Debt Schedules
Amortization Schedules for the 2 types of loans provided in the model (Acquisition and Refinancing Loan)

• Monthly Cash Flow
Monthly CF presents all the operating cash flows of the property over monthly periods. It allows users to control the timing and how the cash flows over that time.

• Annual Cash Flow
A roll-up of the monthly cash flows into annual periods from property acquisition to disposition.

• Project Returns
Report presenting project unlevered and levered returns (Pre-Tax & After-Tax IRR, MOIC, Cash Outflows, Inflows and Profits)

• Investors’ Returns Waterfall
A 2-tier IRR hurdle waterfall model to distribute proceeds between investors. The first tier distributes cash flow to the partners until the LP has achieved some defined preferred return and received a full return of capital. Assuming the preferred return hurdle is hit in tier one, cash flow is distributed in tier two based on a defined profit share percentage.

• Investment Summary:

A high-level summary of the project key info, including:

• Key Project Metrics (Property Size, Acquisition and Exit Yield, Net Investment Profit, CoC Return)
• Uses & Sources of Cash
• Operations Summary (Gross Revenue, Net Operating Income, Net Cash Flow)
• Property Sale and Project Level Return Metrics (Unlevered & Levered)
• Partnership Level Return Summary (LP’s & GP’s)
• Dashboard

Detailed instructions for the use of the model are included in the Excel file.

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Committed to high quality and customer satisfaction, all our templates follow best-practice financial modeling principles and are thoughtfully and carefully designed, keeping the user’s needs and comfort in mind.

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