Net Lease: June 2014

Monday, June 30, 2014

The Boulder Group Arranges Sale of a Net Leased Tuffy Auto Property in the Chicago MSA

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant net leased Tuffy Auto Service Center (“Tuffy”) property located at 3190 North Aurora Road in Aurora, Illinois for $1,487,500.

Tuffy is the sole occupant of the 3,900 square foot retail building that was developed in 2007. The property is located just off of the heavily trafficked intersection of North Eola Road and North Aurora Road which experiences traffic counts in excess of 48,000 vehicles per day. A Jewel-Osco anchored development is across the street from the property that is located in an affluent area. Average household incomes within one mile are in excess of $137,000 annually. There are over thirteen years of primary lease term remaining.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller in the transaction. The seller was a Chicago based private real estate investor and the buyer was in a 1031 exchange.

There are over 13 years remaining on the Tuffy lease that expires in November 2027. The lease features 10% rental escalations every five years. Tuffy is a chain of automotive service centers headquartered in Toledo, Ohio. The company is owned by the Tuffy Associates Corporation which also owns about 170 Car-X Tire and Auto stores. Today, there are over 235 Tuffy locations in 20 states across the eastern United States.

“The market for net lease properties in top tier MSAs remains robust as these assets are in high demand among private investors.” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “Properties featuring long term leases with multiple rental escalations throughout the primary term remain in 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. www.bouldergroup.com

Friday, June 27, 2014

The Boulder Group Arranges the Sale of a Chipotle Ground Lease in the Richmond MSA

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant Chipotle ground lease located at 8955 Staples Mill Road in Richmond, Virginia for $1,630,000.

The 2,215 square foot Chipotle was recently developed in 2013. The 56,715 square foot property is an outparcel to a Target anchored development. The Chipotle ground leased area is 27,007 square feet providing the purchaser with a value add opportunity with the remaining 29,708 square feet of developable land. The property is located along Staples Mill Road, a heavily trafficked north-south thoroughfare that leads to downtown Richmond. A 124,000 square foot Kroger anchored shopping center is currently being developed across the street. There are over 180,000 people living within a five mile radius earning average household incomes in excess of $80,000.

Chipotle has nine years of lease term remaining on their ground lease that features 10% rental escalations every five years in the primary term and renewal options. Chipotle is a publicly traded company (NYSE: CMG) with a market capitalization in excess of $18 billion.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller in the transaction. The seller was a real estate partnership based in North Carolina and the buyer was a German based investor.

“The market for net lease properties in Top 50 MSAs remains robust as these assets are in high demand among private investors.” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “Despite not having a credit rating, Chipotle leased properties are trading at cap rates comparable to investment grade tenanted properties.”

http://www.bouldergroup.com

Wednesday, June 25, 2014

The Boulder Group Arranges Sale of a Single Tenant Zero Cash Flow CVS Property in the Los Angeles MSA

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant zero cash flow CVS property located at 4909 Paramount Boulevard in Lakewood, CA for $2,255,512.

Zero cash flow properties refer to a high quality real estate investment with debt that is fully amortizing and is coterminous with the primary term of the lease. After the primary term of the lease is completed, the investor owns the property free and clear after only having to make a relatively small initial investment.

This property was sold with the in place fully amortizing zero cash flow debt. CVS is the sole occupant of the 12,000 square foot retail building that is located at the heavily trafficked signalized intersection of Paramount Boulevard and Del Amo Boulevard. The area is densely populated with over 31,000 people living within one mile and over 700,000 people living within five miles.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented both parties in the transaction. The seller was a Florida based real estate corporation and the buyer was an East Coast based Real Estate Company.

CVS has twelve years of primary lease term remaining. CVS is a publicly traded company on the New York Stock Exchange (CVS), with a market capitalization of $89 billion. CVS is an investment grade rated company with a Standard & Poor’s rating of BBB+ and they operate over 7,000 locations.

“Zero cash flow properties are useful for estate planning purposes and are an excellent alternative to zero coupon bonds” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “Investors seek zero cash flow properties as it allows one to buy a CVS or related asset with a substantially small down payment.”

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.

www.bouldergroup.com

Monday, June 23, 2014

The Boulder Group Arranges the Sale of a Burger King Ground Lease in the Rockford, IL MSA

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant Burger King ground lease located at 630 Machesney Road in Machesney Park, Illinois for $880,000.

Burger King is the sole occupant of the 3,501 square foot retail building that is located on a 1.34 acre parcel. Burger King has a long standing operating history at this property and is committed to this location as evidenced by their recent execution of a new twenty year lease. The property is located at a signalized intersection along a primary north-south thoroughfare with traffic counts in excess of 25,000 vehicles per day. Rockford is the largest city in Illinois outside of the Chicago MSA.

Burger King has nineteen years of lease term remaining on their ground lease that features 10% rental escalations every five years. The lease is guaranteed by a successful local franchisee that has been operating at this location since 1986.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller in the transaction. The seller was a Midwest based real estate investor and the buyer was a private investor in a 1031 exchange.

“The market for net leased properties priced under $1 million remains active as these assets are in high demand among private investors.” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “Passive investors are purchasing ground leases as an inflationary hedge, as most ground leases provide rental escalations throughout the lease term.”

http://www.bouldergroup.com

Thursday, June 19, 2014

The Boulder Group Arranges Sale of a Net Leased Chipotle Property in Milwaukee

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant net leased Chipotle property located at 3232 South 27^th Street in Milwaukee, WI for $1,824,000.

Chipotle is the sole occupant of the 2,295 square foot retail building that was awarded the Mayor’s Design Award for its outstanding architecture. The property is located along South 27^th Street, a heavily trafficked north-south thoroughfare approximately five miles southwest of downtown Milwaukee. South 27^th Street experiences traffic counts in excess of 31,000 vehicles per day. The property is located within a densely populated area with over 400,000 people living within five miles. A Walmart Supercenter and Walgreens anchored development is located across the street from the property. There are approximately 10 years remaining on the Chipotle lease that was recently extended.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller, a private investor based in Chicago. The buyer was an investor in a 1031 exchange from California.

Chipotle has approximately 10 years remaining on their net lease that was recently extended. The lease features a 12.5% rental escalation in the primary term and renewal option period. Chipotle is a publicly traded company (NYSE: CMG) with a market capitalization in excess of $16 billion.

“The market for net lease properties in Top 50 MSAs remains robust as these assets are in high demand among private investors.” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “Properties with rental escalations throughout the lease term are at the forefront of investor demand because they provide investors with an inflationary hedge.”

About The Boulder Group

www.bouldergroup.com

Monday, June 9, 2014

The Boulder Group Arranges Sale of Triple Net Leased Walgreens Property

The Boulder Group, a net leased investment brokerage firm, has completed the sale of a single tenant triple net leased Walgreens property located at 28895 West Highway 120 in Lakemoor, Illinois for $6,725,000. Lakemoor is a growing community within the Chicago MSA which experienced a double in population since 2000.

Walgreens is the sole occupant of the 14,820 square foot retail building that was completed in October 2013. The property is located at a signalized intersection along Highway 120, the primary east-west roadway in the immediate area. The intersection of Highway 120 and Darrell Road experiences traffic counts in excess of 30,000 vehicles per day. The Walgreens lease has 25 years remaining, a rare feature for a new construction Walgreens property.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented both the seller and buyer in the transaction. The seller was a Midwest based developer and the buyer was a private investor in a 1031 exchange.

Walgreens has approximately 25 years of primary lease term remaining on their lease that commenced in November 2013. Walgreens is a publicly traded company on the New York Stock Exchange (WAG), with a market capitalization of $71 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 most investors are attracted to Walgreens properties, investors in 1031 exchanges have been amongst the most successful in purchasing these properties because of the premium that they are willing to pay.”

http://www.bouldergroup.com