PA Dollar General Sells for 7.35% Cap

Net Lease Press Releases

Calkain Sells Jonestown, PA Dollar General Net Lease for 7.35% Cap

Calkain Companies recently sold a Dollar General (NYSE: DG) net lease investment property located in Jonestown, PA. The transaction closed within the past 60 days and illustrated the compressing cap rates within the net lease segment of the market. The buyer was a privately, Pennsylvania-based net lease fund. The seller was a national real estate company, with a preferred development relationship with the tenant. The same seller has engaged Calkain to sell other stores throughout the mid-Atlantic states. The net lease 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. Investor demand for net lease Dollar General stores has significantly increased since S&P raised the company’s credit rating to investment grade BBB- in April 2012. The Jonestown store was highly sought after given its proximity and access to the I-78 corridor, the surrounding demographics, and the favorable lease structure. Fallon commented, “Cap rates for Dollar General have fallen below 7.50% and will likely trend to 7.25% based on a high demand and competitive bidding environment.” The combination of tenant credit and triple net lease terms provides 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 estate brokerage 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, Calkain has multiple office locations throughout the Mid-Atlantic, Southeast, Northeast and Midwest. Additional information about the firm and listings may be found at www.calkain.com.

Ground Lease Rite Aid Sold

Net Lease Press Releases


Strong Buyer Demand Drives Sale of Rite Aid Ground Lease Sale in New Jersey

Calkain Companies’ Stan Wyrwicz and Mike O’Mara represented the seller in the sale of a Rite Aid Pharmacy ground lease in Vineland, NJ. The site houses a 14,600+/- SF building that are net leased to Rite Aid, which has been operating a pharmacy at that location since 2008. Wyrwicz commented, “We are seeing a strong demand from buyers looking for Rite Aid ground leases and pharmacies, which are a rare commodity. Cap rates on Rite Aid transactions have compressed quite a bit in the last year as a result of the continued progress in its financial turnaround.” The buyer was a private local investor. Jack A. Sattin of Market Development Group, LLC represented the buyer.

 

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Calkain Companies is a boutique commercial real estate brokerage 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, Calkain has multiple office locations throughout the Mid-Atlantic, Southeast, Northeast and Midwest. Additional information about the firm and listings may be found at www.calkain.com.

Net Lease Dollar General in Va Sold

Net Lease Press Releases

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.

Net Lease CAP Rates Cooling-Off

Net Lease Press Releases 

Cap rates on Walgreens and CVS properties remained flat with the quarter prior at 6.45 percent and 6.7 percent respectively, but cap rates on restaurants fell 25 basis points to 7.25 percent. Cap rates on McDonald’s restaurants in particular fell 20 basis points to 4.8 percent, and cap rates on Dollar General stores fell 15 basis points, to 8.1 percent. 

However, few of those properties are trading in the core markets. Finding a McDonald’s or a Walgreens for sale in a primary market has “gotten tougher because there is not a lot of new things coming out of the ground and partly that’s what pushed down cap rates, as well as [the fact that] interest rates have gotten so low,” says Jonathan W. Hipp, president and CEO ofCalkain Cos., a Reston, Va.-based brokerage and consulting firm specializing in the net lease sector.

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Sale of Multi-Tenant NNN Investment in Spring Hill, FL

Net Lease Press Releases

Calkain Companies, a national net lease commercial real estate firm, recently brokered the sale of a multi-tenant, NNN investment in Spring Hill, Florida. The two-tenant investment property is situated on 1.08+/- acres with high visibility to busy US HWY 19, just 30 minutes North of Tampa. It is occupied by Pet Supermarket, based out of Sunrise, Florida. BBB- rated, Humana Marketplace, headquartered in Kentucky is also a tenant.

The site is a 9000+/-sf building divided into 7000+/-sf for Pet Supermarket and 2000+/-sf for Humana. Pet Supermarket renewed their lease for 7 years with structured increases and options and Humana exercised their 2 year option. The seller, an experienced private owner and long-time client of Calkain, was looking to liquidate to secure other opportunities. The property sold for $1.61MM which is a 8% cap rate to a private Florida based buyer completing a 1031 exchange.

Calkain Associate, Teal Henderson, who was recently tapped to open the new Midwest office in St. Louis, MO from Tampa, exclusively represented the private seller and provided marketing and transaction support services throughout the sales process. The property was initially introduced to the market with quickly expiring leases. Henderson commented, "We quickly recognized the hurdle of the current lease terms being unfavorable along with the tertiary and lesser known Florida location of Spring Hill. We counseled the seller in reaching out to the tenants and restructuring with more attractive terms. Then after successful negotiations, we re-introduced the property on the market and generated a quick contract. A private buyer interested in a Florida property with an investment grade tenant with ties to the medical industry purchased the asset." As a NNN ground lease, this investment requires that the tenant pay for real estate taxes, insurance, and maintenance expenses, which effectively provides the landlord with a passive, bond-like income stream through commercial real estate ownership. The transaction occurred within the last 15 days and will be recorded in the public records.

Calkain Companies is a boutique commercial real estate brokerage 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.

NNN Net Lease CVS Pharmacy Sold

Net Lease Press Releases

NNN Net Lease CVS Pharmacy in Washington, DC Trades for $14.5 million

Calkain NNN Investment Advisors recently completed the sale of a NNN investment property in Washington, DC. The purchaser, a private 1031 investor, seeking a stable, credit rated, income-producing asset. The sale, closing at over $1,154 per square foot, broke the record previously set by Calkain for a NNN investment sale.

Rick Fernandez, Managing Director of Calkain Urban retail  Investment Advisors, represented the seller in the transaction and Calkain Managing Director, Jerry Burg, represented the buyer on the purchase of the CVS on Columbia Road in Adams Morgan. “The Adams Morgan CVS is well situated in a grocery anchored, dense, high traffic, urban location within a diverse residential and retail community,” explained Fernandez. “The investor understood that this CVS not only provided a stable income stream backed by a strong credit rated corporate tenant, but also a highly adaptable asset with rock solid generational value,” continued Burg.

The seller reviewed multiple offers from across the country before closing with a private investor who was working with Burg to identify $35MM in NNN investment properties for a 1031 exchange. The transactions closed in the past thirty days.

Calkain Companies is a boutique commercial real estate brokerage 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 and Northeast United States. Additional information about the firm and listings may be found at www.calkain.com.

Investment Retail Property in Columbia, MD

Net Lease Press Releases

  Net lease real estate brokerage firm, recently brokered the sale of long-term triple net lease investment

Calkain Companies, a national net lease real estate brokerage firm, recently brokered the sale of a newly developed, multi-tenant investment retail property in Columbia, MD. The Shoppes at Dobbin Center, a 4,722 square foot three tenant building, was developed by a local group and leased to Starbucks, Radio Shack, and Spa #1 Nails. All of the tenants signed long-term triple net leases with structured rent increases and renewal options. The purchasers were a private group interested in diversifying investments into stable, income-producing real estate.

Calkain’s Andrew Fallon, Assistant Vice President, exclusively represented the seller, and provided marketing and transaction support services throughout the sales process. After working with the seller over the course of the development process, the property was introduced to the marketplace in 1Q 2012. Fallon explains the circumstances, “The property was under LOI and moving to contract the day it was introduced to the marketplace.” Fallon continued, “The seller was able to take advantage of the heated market and compressed cap rate environment given the combination of low interest rates, investor flight to quality, and the laws of supply and demand.” The buyer was a Washington, DC based investor seeking a passive, income-producing property as a family investment.

The characteristics of the property and net lease terms were extremely appealing to the purchasers and other prospective buyers. Calkain received multiple offers for the property, which is extremely well located in the Columbia, MD sub-market. The Shoppes at Dobbin Center was a redevelopment of a dense in-fill parcel in front of a Wal-Mart and adjacent to other national retailers including Chick-fil-a, McDonald’s, and Wendy’s. Further, the net lease structure associated with these corporate leases requires that the tenant pay for real estate taxes, insurance, and maintenance expenses – which effectively provides the landlord with a passive, bond-like income stream through commercial real estate ownership.

Calkain Companies is a boutique commercial real estate brokerage 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 and Northeast United States. Additional information about the firm and listings may be found at www.calkain.com.