Friday, May 9, 2014

The Boulder Group Arranges Another Low Cap Rate Walgreens Transaction for $11 Million in the Chicago Area

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant triple net leased Walgreens property located at the southeast corner of West 95th Street and South Pulaski Road in Evergreen Park, Illinois for $10,833,333.

The property sale ranks in the Top 5 of lowest cap rates ever recorded for a Walgreens property priced over $5 million according to Real Capital Analytics. This is the second transaction ranked in the Top 5 that the Boulder Group has sold in the past four months.

According to a recent research report published by The Boulder Group, cap rates for Walgreens and CVS properties reached their historic low in the first quarter of 2013. Cap rates for Walgreens properties compressed by 15 basis points from the third quarter of 2013 to the first quarter of 2014. The full net lease drug store report can be accessed via

The Evergreen Park Walgreens will be the sole occupant of the 14,820 square foot retail building that is estimated to open in July 2014. This Walgreens is a relocation of a previously successful mid-block store that had excellent sales. The property is located in a densely populated area at a heavily trafficked intersection that experiences traffic counts in excess of 69,000 vehicles per day. Located across the street from the Walgreens is a Target, Home Depot, and Jewel-Osco anchored development. The property is fully leased to Walgreens and will have 20 years of primary lease term remaining upon commencement. The lease features rare rental escalations in the primary term and renewal option periods.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller, a Midwest based developer, in the transaction. The buyer was a Massachusetts based limited partnership in a 1031 exchange.

Walgreens will have 20 years of primary lease term remaining upon commencement and the lease features rare rental escalations in the primary term and renewal option periods. Walgreens is a publicly traded company on the New York Stock Exchange (WAG), with a market capitalization of $66 billion. Walgreens is an investment grade rated company with a Standard & Poor’s rating of BBB and they operate over 8,560 locations.

“The market for Walgreens properties remains active as investors are attracted to investment grade rated companies with long term leases” said Randy Blankstein, President of The Boulder Group.  Jimmy Goodman, Partner of The Boulder Group, added, “While single tenant properties are selling in all types of locations; core markets, like Chicago, are at the forefront of investor demand.”

About The Boulder Group

The Boulder Group is a boutique investment real estate service firm specializing in single tenant net lease properties. The firm provides a full range of brokerage, advisory, and financing services nationwide to a substantial and diversified client base, which includes high net worth individuals, developers, REITs, partnerships and institutional investment funds. Founded in 1997, the firm has arranged the acquisition and disposition of over $1.7 billion of single tenant net lease real estate transactions. From 2011-2013, the firm was ranked in the top 10 companies in the nation for single tenant retail transactions by Real Capital Analytics. The Boulder Group is headquartered in suburban Chicago.