In talking with Jason Powell, senior director at Stan Johnson Co., GlobeSt.com learned that a single-tenant drugstore investment can be a good option for a first-time buyer. Find out why in this EXCLUSIVE Q&A on the subject.
GlobeSt.com: How are real estate fundamentals in the net lease drugstore space today?
Jason Powell: Over the past two years, the drugstore investment landscape has been changing with overall sales volume trending downward and cap rates inching upward. Looking back over the past five years, the peak sales volume, inventory absorption rate, and cap rate lows all occurred in mid- to late-2016. Based on our research, since first quarter 2017, overall drugstore transaction volume declined by approximately 40 percent, while inventory on the market for sale has increased by around 40 percent. On average, cap rates for CVS Pharmacy and Walgreens are between 18 and 33 basis points higher than they were in fourth quarter 2016, however cap rates for stores in prime locations with long-term leases have remained close to where they were in 2016. Walgreens and Rite Aid properties have been the slowest to move, as inventory has accumulated in markets where there is store overlap, creating concerns over potential store closures.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
