Demand Continues from California Investors Chasing Yield

CVS is under a long term, absolute triple-net lease.

MESA, AZ—A number of service-oriented transactions involving tenants with triple-net leases have closed around the Metro. One such deal is a store fully leased to CVS Pharmacy . This CVS is ideally situated within a significant growth area—surrounded by rooftops and serving an expanding area of Mesa that continues to experience significant growth. It is situated at the intersection of Ellsworth and Broadway Roads, visible to 31,500 cars per day. The property is less than one half mile from AZ Loop 202 (serving 43,102 cars per day), a vital connector between Mesa, Phoenix, Tempe, Chandler and Gilbert, and also three miles from US Highway 60, which offers ease of access from surrounding areas. It also benefits from the additional customer base in the winter when the “snowbirds” settle in. The investment property is under a long term, absolute triple-net lease as of when the property was constructed in 2004. Closing at more than $3.375 million, this freestanding building comprises 13,504 square feet. A second Mesa, AZ investment sale, this one leased to another national triple-net tenant, Starbucks , closed at $2.32 million. With brand new construction, the building is leased to Starbucks on a corporate guarantee. This 1,943-square-foot freestanding building is situated on the hard corner of Country Club Drive (SR 87) and Juanita Avenue, visible to 51,000 cars per day. Nick Miner , senior vice president at ORION , who recently closed the Mesa CVS and Starbucks transactions, tells GlobeSt.com: “Phoenix continues to be a great investment market for commercial real estate investors.  Our returns are typically higher than competing markets in California and that is why we are seeing more demand from the California investor as they continue to chase yield.” Finally in Scottsdale, AZ, Lightning Lube , a 3,030-square-foot automotive repair/service building, recently sold for more than $1 million or $335 per square foot. Located directly on Scottsdale Road, south of McDowell Road, the area is dominated by automobile businesses. Built in 1988, and situated on two parcels, the freestanding building features three bay doors, an office, ample parking and excellent Scottsdale Road frontage. This well-located property is down the road from SkySong, the ASU Scottsdale Innovation Center . Lightning Lube is a long-term tenant and recently signed a new 20-year triple-net lease. The property was sold by Goldmine 1025 Properties LLC based out of Chicago. The buyer was Newman Revocable Living Trust based out of Southern California.