Calkain Companies recently sold a Dollar General (NYSE: DG)
net lease investment property located in Petersburg, VA. The transaction closed
within the past 30 days and illustrated the compressing cap rates within the
net lease segment of the market. The buyer was a privately held, fully
integrated real estate investment company. The seller was a regional real
estate developer. As a preferred developer for Dollar General, the same seller
has engaged Calkain to sell another store in Halifax, VA. These Dollar General
properties have been developed as part of Dollar General’s build-to-suit
program. The stores have brand new 15-year triple net leases, which provide
passive income for the new owner.
Calkain’s Andrew Fallon, Assistant Vice President,
facilitated the transaction by providing exclusive representation to the
seller. More sales of Dollar General Stores have been transacting since S&P
raised the company’s credit rating to investment grade BBB- in April 2012. The
Petersburg store was highly sought after given its proximity and access to the
I-95 corridor, the surrounding demographics, and the favorable lease structure.
Fallon commented, “As Dollar General continues to roll out new stores in new
markets, the investor demand continues to increase for superior market
locations.” The combination of tenant credit and triple net lease terms provide
a passive, bond-like fixed income investment, “The leases with Dollar General’s
guaranty provide a strong income stream for the buyer, who will have limited to
no management responsibilities.” The buyer financed the purchase using a
regional bank.
Calkain Companies is a boutique commercial real estatebrokerage firm which specializes in assisting buyers and sellers with single
and multi-tenant retail, industrial, hotel and office net leased transactions.
While licensed to conduct business in many states, nationally, Calkain has
multiple office locations throughout the Mid-Atlantic, Southeast, Northeast and
a new office opening in the Midwest. Additional information about the firm and
listings may be found at www.calkain.com.
