Over the past few years Dollar Store properties have become some of the most attractive Net Lease Investments available for buyers and investors. The popular stores are still single-handedly changing the net lease investment market, which has traditionally been dominated by drug store, fast food and automotive retail concepts. It is the only sector within net lease that maintains an adequate supply due to their attractively priced products. Sales revenues have soured for the three main Dollar Stores: Dollar General, Family Dollar, and Dollar Tree. Dollar Store properties generally offer a strong corporate guaranty, investment grade credit, 15 year NNN leases, and can still be bought at or above a 6% cap rate. Dollar stores have experienced increased demand for new construction and command a premium over asking cap. Dollar stores have become strategically stronger by reducing their scope of operations and focusing on one simple formula–the dollar model. The average cap rate of Dollar Store transactions in 2014 is around 7.94%.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Jonathan Hipp
Jonathan Hipp began his career in real estate over 25 years ago. In his early years as a broker, he ventured into the net lease industry and quickly began leading the US net lease market, closing over $3 billion in transactions. In 2005, Jon founded Calkain Companies, a company focused solely on net lease investment services. As President and CEO, he has been instrumental in building the firm into one of the leading Net Lease real estate companies, transacting over $12 billion of net lease deal volume over the past 13 years. He has expanded Calkain’s services to include brokerage, advisory, asset management, capital markets, and industry research. He has become a well-known resource, panelist, and speaker at various Net Lease and Industry conferences and is a regular contributor to GlobeSt.com on real estate trends. In June 2015, Jon’s passion for the real estate business was again recognized as he was nominated for the Top Real Estate Player in the DC area by SmartCEO magazine.
