Why NNN Investors Prefer Wisconsin State: Higher Growth & Competitive Cap Rates Explained
Future Holding for NNN Property Investments in Wisconsin
Triple Net Lease (NNN) properties, where tenants cover property taxes, insurance, and maintenance costs, remain a strong investment option for those seeking predictable income with minimal landlord responsibilities. In Wisconsin, the outlook for NNN property investments is positive, supported by several key factors:
1. Economic and Population Growth
Wisconsin’s economy is diversified, with strengths in manufacturing, healthcare, agriculture, and technology. Cities such as Madison, Milwaukee, and Green Bay are experiencing steady growth, while areas around Dane County and Waukesha are seeing population increases. This growth drives demand for retail, healthcare, and industrial spaces—prime targets for NNN investors seeking long-term stability.
2. Stability and Demand for NNN Properties
NNN leases provide long-term income security since tenants are responsible for property expenses. In Wisconsin’s evolving commercial real estate market, investors favor these properties because they minimize management headaches and offer consistent returns, even during uncertain economic cycles. The stability of tenants like national retailers, grocery chains, and medical operators makes Wisconsin an attractive location for net lease investments.
3. Market Trends and Cap Rates
Cap rates for NNN properties in Wisconsin typically range from 5.5% to 7%, depending on tenant creditworthiness, location, and lease terms. Recent market shifts have pushed cap rates slightly higher, giving investors opportunities for stronger yields compared to more compressed markets in coastal states. Wisconsin’s balance of affordability and demand positions it well for investors seeking solid returns.
4. Financing Considerations for NNN Investors
Like other states, NNN property acquisitions in Wisconsin generally require substantial capital. Investors should expect down payments of 30%–40% of the purchase price, with lenders often seeking a net worth above $1 million or annual income over $200,000. Understanding these financial requirements is critical for buyers leveraging 1031 exchanges or expanding their portfolios.
5. Local Market Opportunities
Wisconsin offers diverse opportunities for NNN property investors across multiple sectors:
Industrial Properties – Demand is strong in markets like Kenosha and Racine, benefiting from proximity to Chicago’s distribution hubs.
Retail & QSR Tenants – Properties leased to national chains (Dollar General, Walgreens, Starbucks) remain highly sought after in suburban and rural areas.
Healthcare & Medical Offices – Madison and Milwaukee show strong demand for medical-related NNN properties, supported by Wisconsin’s robust healthcare sector.
Investors utilizing 1031 exchanges can find multiple options in Wisconsin’s growing markets to defer capital gains taxes while securing stable income streams.
Triple-net (NNN) investors are increasingly turning to Wisconsin as a prime location for net lease properties, thanks to its stable economy, attractive cap rates, and growing demand for essential retail and industrial assets. Here’s why NNN brokers and investors see Wisconsin as a lucrative market:
1. Attractive Cap Rates Compared to Other States
Wisconsin offers competitive cap rates, generally ranging between 5.5% to 7%, depending on tenant credit and location. These cap rates are often higher than those in more competitive coastal markets, giving investors stronger yields while maintaining stability with long-term tenants.
2. Affordable Property Prices
Commercial real estate in Wisconsin is more affordable compared to states with high-cost markets. This affordability allows NNN investors to purchase properties leased to national brands and essential retailers at lower entry costs while enjoying reliable cash flow.
3. Growing Population & Economic Development
Wisconsin’s population is steadily increasing in cities like Madison, Milwaukee, and Green Bay, supported by a strong job market and a high quality of life. The state’s diverse economy—anchored by manufacturing, healthcare, technology, and agriculture—continues to attract businesses and boost demand for commercial real estate.
4. Strong Demand for Essential Retail & QSRs
NNN brokers and investors are finding consistent opportunities in Wisconsin’s essential retail and quick-service restaurant (QSR) sector. Tenants such as Dollar General, Walgreens, Starbucks, McDonald’s, and Culver’s (a Wisconsin-based favorite) provide long-term, stable leases that appeal to net lease investors.
5. Business-Friendly Environment & Investor Advantages
Wisconsin maintains a balanced regulatory and tax environment that encourages business growth. For NNN investors, this creates a reliable landscape where essential services and retail continue to thrive. Investors also benefit from the ability to utilize 1031 exchanges to defer capital gains taxes while reinvesting into Wisconsin’s growing market.
6. Expanding Industrial & Logistics Growth
The state’s central location in the Midwest makes Wisconsin a strong hub for industrial, distribution, and logistics properties. Cities like Kenosha and Racine, near the Chicago metro, are seeing major growth in warehousing and supply chain infrastructure. This trend increases demand for single-tenant net lease properties tied to logistics and service industries.
Income Taxes
Wisconsin’s Tax Considerations for NNN Investors: What to Know About Net Lease Properties
Wisconsin offers a balanced tax environment that NNN investors should carefully evaluate when considering net lease property investments. While it is not a no-income-tax state, Wisconsin’s progressive tax structure, moderate corporate tax rate, and competitive property taxes create a stable investment landscape. Here’s what investors and NNN brokers need to know:
1. State Income Tax on Rental Income
Unlike states with no income tax, Wisconsin taxes rental income earned from NNN properties. Net lease investors who own properties through an LLC or individually are subject to the state’s personal income tax rates, which are progressive and range from 3.5% to 7.65%. This means higher-income investors may see a portion of their returns allocated to state taxes, but Wisconsin remains competitive compared to high-tax coastal states.
2. Corporate Income Tax
For investors operating under a corporate structure, Wisconsin imposes a flat corporate income tax rate of 7.9%. While slightly higher than some neighboring states, this rate is predictable and helps corporations manage long-term financial planning when investing in net lease properties.
3. Personal Income Tax Rates
Wisconsin uses a tiered personal income tax system:
3.5% on income up to $13,810 (single) / $18,420 (married filing jointly)
4.4% on income between $13,811 and $27,630
5.3% on income between $27,631 and $304,170
7.65% on income over $304,170
For NNN investors with significant rental income, this means higher brackets may apply, but the rates are still moderate compared to states like California or New York.
4. Estate & Inheritance Taxes
Wisconsin does not impose a state-level estate or inheritance tax, which is beneficial for investors looking to pass down NNN properties to future generations. This ensures wealth built through net lease real estate remains largely preserved.
5. Property Tax Rates
Wisconsin’s property tax rates are above the national average, with an effective property tax rate of approximately 1.68%. While higher than states like Florida or Texas, property taxes in Wisconsin directly support strong local infrastructure and services, making commercial real estate locations more attractive to tenants and consumers. For NNN investors, this means slightly higher holding costs, but also stronger tenant demand in well-developed markets.
6. Capital Gains Tax Treatment
Wisconsin taxes capital gains as part of regular income but allows a 30% exclusion on long-term capital gains (60% for farm property). This means only a portion of gains are subject to tax, making it more favorable for investors using 1031 exchanges or planning an eventual exit strategy from their NNN properties.
Investing in triple-net lease (NNN) properties in Wisconsin can be a strategic move, especially in regions experiencing population growth, economic development, and increased demand for commercial real estate. With tenants covering property taxes, insurance, and maintenance, NNN properties offer investors a hands-off, stable income stream. Based on recent trends, here are some of the top cities and counties in Wisconsin to consider for NNN property investments:
1. Dane County (Madison):
Population Growth: From 2023 to 2024, Madison County’s population increased by 9,464, with a net migration of 8,680 individuals.
Economic Development: Huntsville has become a hub for aerospace and defense industries, attracting a skilled workforce and fostering economic expansion.
Investment Potential: The combination of rapid population growth and a strong economy makes Madison County a prime location for NNN properties, particularly in sectors like retail and office spaces that cater to the growing populace.
2.Milwaukee County (Milwaukee Metro):
Population Growth:
While overall growth is modest, suburban areas around Milwaukee are seeing steady increases as families and professionals move for affordable living and access to urban amenities.
Economic Development: Milwaukee has a diversified economy, including manufacturing, finance, healthcare, and logistics. Continued investments in infrastructure and real estate revitalization add to its appeal.
Investment Potential:
NNN properties leased to national tenants, quick-service restaurants (QSRs), and medical facilities are in strong demand throughout the Milwaukee metro area.
3. Brown County (Green Bay):
Population Growth: Brown County’s population continues to grow steadily, supported by suburban expansion around Green Bay.
Economic Development: Green Bay is a hub for healthcare, manufacturing, and logistics, anchored by major employers like Bellin Health, Schneider National, and the Green Bay Packers’ tourism economy.
Investment Potential: Retail centers, essential services, and industrial NNN properties present strong opportunities in this expanding market.
4. Waukesha County (Milwaukee Suburbs):
Population Growth: Waukesha County consistently ranks among Wisconsin’s fastest-growing suburban areas, attracting families and professionals seeking high-quality schools and proximity to Milwaukee.
Economic Development: The area benefits from strong healthcare, finance, and professional services sectors. Suburban commercial development is robust, supporting new retail and service-based businesses.
Investment Potential:
The combination of suburban expansion and high household incomes makes Waukesha ideal for NNN retail and professional office investments.
5. Outagamie County (Appleton):
Population Growth: Appleton and surrounding communities have experienced steady population increases, supported by affordable housing and strong job markets.
Economic Development: Outagamie County is supported by paper manufacturing, healthcare, and retail. The area also benefits from its strategic location in the Fox Cities region.
Investment Potential: Growing demand for healthcare, neighborhood retail, and QSR properties makes Appleton an attractive market for NNN investors.
6. Kenosha & Racine Counties (Southeastern Wisconsin):
Population Growth: Both counties have seen steady in-migration, especially from nearby Illinois, as families and businesses take advantage of Wisconsin’s lower cost of living.
Economic Development: These counties serve as logistics and industrial hubs, benefiting from their proximity to Chicago and major transportation corridors. Amazon and other distribution centers have fueled rapid economic growth.
Investment Potential: Industrial NNN properties, distribution facilities, and retail serving expanding suburban populations are prime opportunities.
Pros:
1️⃣ Competitive Cap Rates
Wisconsin offers cap rates in the 5.5%–7% range, which are higher than those in coastal markets like New York or California. This allows investors to achieve stronger cash flow and steady long-term returns.
2️⃣ Affordable Commercial Real Estate
Compared to high-cost states, Wisconsin’s property prices are moderate. This provides investors with more accessible entry points into the NNN market while still securing properties leased to strong national tenants.
3️⃣ Stable Economy & Population Growth
Wisconsin’s economy is diverse—spanning manufacturing, healthcare, agriculture, and technology. Population growth in areas such as Madison, Dane County, and the Milwaukee suburbs supports strong demand for retail, healthcare, and service-based tenants.
4️⃣ Strong Industrial & Logistics Hub
Southeastern Wisconsin (Kenosha, Racine) benefits from proximity to Chicago’s logistics corridor, fueling demand for industrial and distribution-related NNN properties. Amazon and other major companies have expanded here, driving tenant stability.
5️⃣ Healthcare & Education Demand
Madison (University of Wisconsin, healthcare systems) and Milwaukee (Froedtert, Aurora Health) support long-term demand for medical and educational real estate, making NNN medical offices and specialty clinics attractive investments.
6️⃣ No Estate or Inheritance Tax
Wisconsin does not impose estate or inheritance taxes, making it easier for investors to pass properties to heirs without additional burdens.
Cons:
1️⃣ Moderate-to-High Property Taxes
Wisconsin’s average effective property tax rate is ~1.68%, higher than the national average. While this supports strong public infrastructure, it also increases long-term holding costs for investors.
2️⃣ Slower Appreciation Compared to Sunbelt States
Property values in Wisconsin tend to grow steadily but more slowly compared to high-growth states like Texas or Florida. Investors seeking rapid appreciation may find Wisconsin more of a cash flow play than a speculative growth market.
3️⃣ Harsh Winter Climate
Wisconsin’s long, cold winters can increase maintenance costs for tenants and landlords. This may also impact tenant performance in certain retail sectors dependent on seasonal traffic.
4️⃣ Tenant Demand Varies by Location
Urban areas like Madison, Milwaukee, and Green Bay offer strong tenant demand, but more rural areas may struggle to attract national tenants. Due diligence is critical for investors considering smaller markets.
5️⃣ Higher State Income Taxes
Wisconsin has a progressive state income tax system (3.5%–7.65%), which applies to rental income. While predictable, this can reduce net yields compared to states with lower or no income tax.
Wisconsin NNN Properties for 1031 Exchange
Invest in Free Standing Single Tenant Triple Net (NNN) Properties in Wisconsin
Are you looking for a reliable 1031 exchange replacement property?
At Triple Net Investment Group, we specialize in the sale of single tenant NNN properties and triple net shopping centers across the United States. Our team is dedicated to helping investors find high-quality (Tenant Triple Net) NNN properties in Wisconsin and nationwide that align with their financial goals and 1031 exchange requirements.
With our in-depth market knowledge and personalized service, we provide tailored investment strategies for both buyers and sellers of commercial real estate. Whether you’re looking to defer capital gains through a 1031 tax-deferred exchange or want to diversify your portfolio with income-generating assets, our team offers a wide selection of vetted NNN investment properties.
Corporate Tenant Credit Ratings
Find out more about the credit rating of the tenant before purchasing.
How safe are the triple net investment grade free standing single tenant properties?
Market Analysis
What three things should I know before investing?
Call or e-mail us and we will get back to you within 24 hours. We know of properties for sale that aren’t listed or advertised.
Email: info@nnndeals.com Tel: 202-361-3050
We strive hard to provide clients with quality customer service
We provide our clients with all of the information they need upfront to make an informed decision, even before a Letter of Intent is issued such as: tenant credit information, store sales, lease terms, options, renewal rates, rent escalations, location analysis, site analysis, market analysis, demographic data, cash on cash returns on investment, internal rate of returns after taxes, risks, likes, dislikes and so on. We will then strategies how to proceed on making a best offer. It is our goal to build a solid relationship with our clients and keep them updated on net lease investments, even though they may not have a need for years to come.(NNN Properties in Wisconsin)
We markets our listings locally, nationally and internationally
Triple Net Investment Group difference is a concept that is revolutionary in the commercial real estate brokerage business. In addition to marketing our deals to potential investors, We markets our listings to the entire brokerage community. We put our listings directly in front of thousands of commercial real estate agents in each state, region and local where the property is located.
