A measurement expressed as a percentage of the total amount of vacant space divided by the total amount of inventory. This measurement is typically applied to a building, a submarket, or a market.

Here’s how it works: the asset, previously owned by the seller, is sold to another party and then leased back to the original owner for an extended period. These transactions generate long-term bond-like cash flows, as leases typically are 10-15 years long. Moreover, the lessor (the new owner of the building) usually is exempt from operating expenses, property insurance, and real estate taxes on the property, referred to as a triple net lease (NNN).

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