NORTHBROOK, IL— In April, GlobeSt.com reported an increase in demand for single tenant net-leased properties and a fall in their cap rates to historic lows. And that appears to be having an impact in the Midwest. The Boulder Group, for example, a net-leased investment brokerage firm, has just completed the sale of a single tenant net-leased Shopko portfolio consisting of two Midwestern properties for $17,625,000. The stores are located at N66 W 25201 County Highway VV in Sussex, on the outskirts of Milwaukee, and 2320 Lineville Road in Green Bay.
Shopko and its affiliates run over 300 retail stores that sell clothes, products for the home and healthcare goods. They fully lease each 80,000-square-foot property on a long-term basis. Each lease has approximately 16 years remaining and also includes periodic rental escalations. Both properties sit on eight acres and were developed for Shopko in 2009.
Randy Blankstein, president of Boulder, and Jimmy Goodman, a partner, represented the seller; a Midwest-based developer, in the transaction. The buyer was a West Coast-based investment firm.
“The Midwest net-lease market remains strong for corporately guaranteed single tenant properties with ten or more years of lease term remaining,” says Blankstein. Goodman adds, “There has been an increase in demand for long-term leased non-investment grade properties, as they generate higher yields than the typical core net lease assets.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
