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Owners Creating New Net-Lease Products

CHICAGO—New construction of single-tenant net-leased properties has not kept pace with demand, so some investors have figured out creative ways to get properties on the market.

By Brian J. Rogal | Updated on July 15, 2013

CHICAGO—In March, The Boulder Group, an investment brokerage firm located in suburban Northbrook, completed the sale of a single-tenant net-leased Walgreens property at 9290 Wicker Ave. in St. John, Indiana, about 24 miles southeast of Chicago, for $3,530,864. And yesterday, the buyer put the same property back on the market with an asking price of $4,727,272 and a cap rate of only 6.05%.

The change? Since the initial purchase, the buyer, a private investment fund, agreed to renegotiate the lease with Walgreens and got a ten-year extension in exchange for a rent reduction. Instead of a lease with seven years, Walgreens now has seventeen years remaining.    

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