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ORANGE COUNTY, CA-While most experts in the sector vehemently deny that net lease has become too safe, Sidney Domb, president of UTF, has a different take on the matter. His thoughts are that net lease could indeed be too safe and not provide enough yield for investors—IF their leases are set up incorrectly.

“We started doing this in 1972, so we’ve been in this for 40 years,” Domb says. “When we started, the concept that we had was that we do not have any staff outside fixing anything, so let’s not buy anything unless there’s nothing we have to do but collect a check. We sat down with an attorney—one we’ve been using for 28 years—and made up a bond net lease that said the tenant does everything. Even in the event that there’s a condemnation, the tenant has to make an offer to purchase the property.”

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