In a testament to how quickly time passes, we signed our lease on the Buttonwood space TWO MONTHS AGO. I'm happy to report that we are pretty confident we will be celebrating our three-month-lease-anniversary in the actual space. Big things are happening in the space this week and Contractor Susan even secured us a legit United States Postal Service address and if we can get USPS to agree that we exist, then we must be close, right? Part of our lease deal with Silent Stan was a 60-day rent abatement to allow us time to get in the space. As part of our lease agreement, we pay our base rent and the something call "triple nets". Before playing in Silent Stan's world, I had never even heard of triple nets...and all you really need to know is that they are triple annoying. In short, triple nets is just a super fancy pants way of saying that you help pay for the insurance, tax, and common area maintenance. Each month.
So, the common area maintenance seems legit...I prefer my sidewalks shoveled and parking lots salted after an ice storm. In case you are interested, that costs $201.25 per month per unit at Buttonwood. That seems super pricey to us...do you think I would totally irritate Silent Stan if I asked for an accounting of that monthly $201.25? There isn't much grass to mow and the parking lot is marginal...so...I'll be really super excited to see what our annual $2,415 gets us. Personally, I would like to see the parking space lines repainted. Should I suggest that on a sticky note on the check I send in?
But that doesn't even address the rest of the triple nets. I actually had to clarify with Real Estate Agent Mel that I understood correctly and here is the best way I can explain it: each tenant in the building helps pay for the building's insurance and tax costs. WHHHHHAAAAAAAATTTTT?
So, if I bought a building and zoned it commercial, I can charge rent for each unit and then demand everyone in the building pay for the taxes due on the property and the cost to insure the building...even though none of the tenants have an ownership interest in the building?
Here also is the hook...while our rent starts on March 10th, triple nets have been going since Day 1. The bill that came in the mail today was a little overwhelming. Insurance will cost $17.50 per month ($210 per year). Taxes will cost $116.38 per month ($1,396.56 per year).
You know how people tend to ask you what you would go back in time and tell yourself when you were a kid? I used to say "buy Microsoft" but now I would like to also add "and buy a ton of commercial property and convince other people to pay for the maintenance, the taxes, and insurance while you just sit back and collect the cash and then buy a plane and some sports teams." (And also, I would add: don't let your mother talk you into red framed glasses in 1985...it wasn't a good idea, then or ever.)