Triple net properties, or NNN properties, are an attractive real estate option for investors looking to expand their portfolios with a variety of property types. NNN leases can be applied to properties like retail, dining, offices, or industrial space. This means that acquiring NNN properties can truly diversify a portfolio with lower risks than other properties. When considering which types of properties to invest in for triple net leases, investors should consider fast food restaurants, such as Taco Bell.
When commercial real estate investors want to acquire a new property, they often go to what they know. Their portfolios may consist of many similar types of properties. But it doesn’t have to be that way! Diversifying a real estate portfolio can be one way to ensure sustainable, steady growth over the long term. Commercial real estate investors may shy away from industrial properties for sale if they have never considered one before, but there is great growth in the industry and there can be strong returns to investors who do it right.
When considering expanding a portfolio, an investor may want to search for properties that are familiar to them. For some investors, that means multi-tenant residential properties; for others, that is retail or medical listings. However, one way to increase diversification is to go outside that comfort zone and find something completely new.
Industrial real estate is a growing industry for many real estate investors. Industrial spaces can have many uses, but they all have a few things in common: their tenants need the space to run their business and they will stay in one place for a long time. Let’s take a look at industrial spaces for sale and how these industrial properties can grow your portfolio. Read more
As a commercial real estate investor, you may be seeking out the next opportunity right now, or just keeping your options open for future investments. New investment opportunities offer a great chance for you to diversify and grow your portfolio, or simply a chance to trade out a lower performing property for something that will bring you more value in the long run. Whether you currently have a vast array of property types or you’ve focused on one primary type like office buildings, you may be wondering about other ways to increase your investments — and your income. One type of commercial property that can help you grow your portfolio is commercial warehouses for sale.
Commercial warehouses come in all sizes, and they can be used for small, local businesses selling items online or for large, multi-state or multi-national companies with huge ecommerce and sales success. They are found across the country in order to serve their customers, who range from businesses to consumers to even a single company storing items until they are needed. No matter the size of the warehouse, there are a few key benefits investors have found when investing in this type of commercial real estate property. Let’s dive a little deeper into investing into the warehouse property type.
Why Invest in Commercial Warehouses
Investing in commercial warehouse properties for sale often makes sense for people. These leases tend to be much longer term, so you won’t have to constantly seek out a new tenant. With options for a longer lease, commercial warehouses can be a great property for triple net leases, where you can pass off many of the maintenance and tax costs to the tenant. You’ll see a higher return on this property type in most cases, as well. While commercial warehouses may have a higher entry point, most investors make their money back relatively quickly with this high value opportunity zone real estate.
Right now, we are still in the post-pandemic market. During the past 15+ months, ecommerce boomed, which means that there has been a great demand for commercial warehouses for sale across the country. People got used to online shopping and have shifted much of their shopping habits away from brick and mortar stores. This trend of online shopping and businesses needing warehouse space is not going away any time soon. That makes this a great time to invest in commercial warehouses to grow your commercial real estate portfolio.
3 Pros of Commercial Warehouses For Sale
Because commercial warehouses are in high demand, both from businesses and from their customers who are continuing to shop online necessitating more warehouse space for processing orders, these three advantages can be found with this type of commercial real estate:
- Higher return on investment
- Long-term leases
- Lower maintenance needs and costs
3 Cons of Commercial Warehouses
Now, as with anything, there are cons to investment opportunities. So you have the best information going into any investment, you should know these three challenges associated with investing in a commercial warehouse:
- Higher entry costs
- Longer timeframe for finding new tenants
- Technological advancement may outpace the space
Top Tips to Finding the Best Commercial Warehouse Opportunities
When you’re looking for the right commercial warehouse to invest in, there are a few key things to keep in mind. Location is very important to these types of businesses, but often in a different way than other properties you may currently own. Here are four elements of the location to understand when seeking out a commercial warehouse space to invest in.
Location: Distribution centers and warehouses are often located near large population centers. This means there will be better access to more trucks for cross-country delivery. But a large population area doesn’t necessarily mean a big city, which would have more traffic and increased costs. You can find warehouses properties for sale in every state, and in most cities too. In most cases no matter where the warehouse is located, investors are able to plan for reliable monthly income with few landlord responsibilities, especially when tenants and landlords agree to a NNN lease.
Space: With a commercial warehouse, there needs to be plenty of space for delivery of product. The business relies on receiving products, as well as processing orders and distributing products. This means they will need to have space for trucks to come and go and unload or load materials. Commercial warehouses are often best situated near transportation, like highways or interstates, as well as airports or ports (if located near oceans and large rivers used for transportation). Because the costs of bringing in materials and shipping them out is usually more than half of the expenses these businesses see, location really matters for warehouses.
Storage: Aside from needing space for loading and unloading, commercial warehouses can be used for other things than ecommerce. The changing supply chains now mean more businesses have a need for extra storage or manufacturing space. Some businesses or product types need climate-controlled commercial warehouse space, and across the country the industry has seen a demand for cold storage during vaccine distribution. Storage for products, manufacturing, or other needs as supply chains, businesses, and offices change is continuing to grow.
Height: A unique element to commercial warehouses is the need to understand the importance of height (floor to ceiling space inside the building). The property’s square footage only tells part of its storage capacity, in floor space. But with height, this gives investors and tenants a better idea of the unobstructed space within the building, representing the stacking potential of warehouse contents like crates and boxes.
Work with a Pro to Find the Right Commercial Real Estate for Sale
When you partner with a commercial real estate broker who has your goals in mind, you are better equipped to find the right listings and properties to grow your portfolio. At Sands Investment Group, our brokers across the country work with you to identify your goals, define success on your terms, and find the properties that fit your needs including industrial properties, office spaces and a variety of commercial properties. If you’re ready to discuss adding a commercial warehouse to your portfolio in the post-pandemic market, contact the broker team today by calling 844.4.SIG.NNN or sending an email.
If you are in the market to do some investing, look no further than a self-storage unit to bring in some cash. If Covid-19 taught us anything, it is that the financial world can change on a dime, but real estate investors would prefer something a little more stable. According to Bloomberg Markets, storage space is “… the number one alternative investment.” Compared to other forms of real estate investments, self-storage investing enjoys many attractive attributes: Resistant to Recession, Relatively High Returns, Opportunities for Consolidation, Lower Breakeven Occupancy Rate, Low Maintenance and Less Hassle. Owning a self-storage unit is an investment that will pay dividends without breaking the bank of time or money.
Advantages of Self-Storage Investments
A self-storage facility has many advantages. With a low overhead cost, this asset class allows for an impressive potential income. The smaller and mid-size units do not need much hands-on management, and can get by with only part time managers. A self-storage facility also does not have the challenges and headaches that a rental apartment or housing unit might have.
Month to month leases provide the ability to change rental fees more quickly, and there are so many self-storage units around, offering a big pool for investors.
With fewer moving parts to a storage unit (no bathrooms, no human tenants, no grandiose expenses), investing in a self-storage unit is a great idea for positive cash flow. They are also very stable investments, even when the economy is not, and can be used by renters in various ways. US News and World Report said, “The flexibility of self-storage facilities makes them incredibly resilient through all economic cycles because people always seem to find a use for them.” Even if the market or the world’s health is unstable, people will always find a use for their storage unit.
Purchasing Your First Self-Storage Property
Just like other commercial real estate investments, self-storage properties are listed and sold based on cap rates, which directly relate to the investments NOI. This is how much cash flow the investment produces after accounting for all expenses and income. The higher the capitalization rate, the higher return investment is likely to be achieved and the better rate of return for the investor. Prior to purchasing your first storage property, it is important to put together a cash flow analysis, looking at all expenses relating to operating the self-storage business, including:
- Management fee (at least 5% of gross rents suggested).
- Payroll (for larger facilities).
- Property insurance.
- Advertising or marketing.
- Real estate taxes.
- Office supplies.
- Repairs and maintenance.
- Online software.
- Phone or internet.
- Lawn care and pest control.
- Trash service.
- Credit card processing fees.
- Miscellaneous fees.
The property should have adequate cash flow to cover all of the expenses listed above in this article and any debt service. If it is an underperforming property, it may not have enough cash flow to cover expenses and require property improvements.
Most self-storage facilities are Class B or C facilities, especially those owned by inexperienced or small-sum investors who invest minimally. Many of which older in age, need some improvements, and are not performing to standards of the market. This gives an opportunity to investors to add value by providing capital improvements, raising rents, expansion, limiting costs, and developing better management processes, among other areas of improvement.
The most ideal self-storage facility to find is one that meets the following criteria:
- Proper signage with facility name and number easily visible.
- Many advertised unit sizes at market rents.
- Proper lighting (ensuring the facility is safe at night).
- Security cameras.
- Proper drainage (meaning units won’t flood or freeze shut during inclement weather).
- Attractive building or buildings (fresh paint, clear branding, manicured lawn, appears safe).
- Automatic gate with 24-hour access.
- A website with online rental and payment capabilities.
A success story
Dan Hogan is one of the successful self-storage entrepreneurs, having bought some land in 2020 and worked it into a successful self-storage business today.
Dan was attracted to self-storage for two reasons. “With the self-storage business, I saw two things immediately: managing the facility was very simple and could be done with one employee or one and a half employees. Second, the facility would get to the point where it would throw off cash flow. And it’s proven to be true,” he says.
After 11 years in business, Hogan is not only making money, but he is thriving and at 90% capacity. He is also getting ready to add 65,000 square feet to his business. Despite the upheaval of the past year amidst Covid-19, his self-storage facility is going strong.
“Personally, it is nice to have the comfort that we have equity in self-storage. There aren’t any guarantees in our other business whereas the self-storage model has demonstrated for years continuous incremental growth with incremental profit. And the peace of mind that brings is infinitely valuable.”
No matter what stage of life you are in, investing in self-storage is a good way to find some stability in an uncertain world. Whether building your own or buying an existing business, the sky’s the limit for this successful investment opportunity. Read his story here.
What Others are Saying
“The bottom line is that if we go into a bad housing market, people have to put their stuff somewhere. When the economy is good and people buy too much stuff they have to put it in storage. You’re winning as the market goes down, and winning as the market goes up.” – Joel Cone, US News
“Self-storage is a unique asset class. It has a reputation of providing relatively high yields and has shown to be relatively resistant to recessions due to its lower declines and default ratios versus other asset classes.” – David Thompson, BiggerPockets
“One of the hallmarks of a recession is the movement of consumers into less spacious accommodations. As wages stagnate, and the employment picture gets grimmer, homeowners and renters tend to downgrade the size of their homes, but they still need a place to store their stuff. Self-storage facilities benefit from this demand and can see increased rental rates during a downturn.” – Ari Rastegar, SpareFoot“
Let’s assume you had $200,000 to invest in 1994 and put your money equally into two investments. One investment for $100,000 in a self-storage REIT and reinvested all earnings while you put another $100,000 into the S&P 500 and reinvested all dividends. By 2017, the self-storage REIT would have grown to $4,026,413 while your S&P 500 stock fund would have grown to $532,243. Self-storage outperformed the large capitalization stocks index by a whopping $3,494,170.” – David Thompson, Bigger Pockets
Work with Real Estate Experts to Buy a Self-Storage Facility
When you’re ready to start the conversations with net lease experts about an investment in storage properties for sale, the team at Sands Investment Group can help. We have facilitated transactions of many self-storage facilities across the country, ensuring that investors not only find the right opportunity but get the best deal when adding to their portfolio. SIG’s self storage experts can discuss all the factors and considerations in investing in a storage property and help you identify the listings that meet your goals. From single net lease opportunities to an absolute NNN lease and triple net real estate, Sands Investment Group has you covered. If you’re ready to make a smart net lease buy for 2021 and purchase a self-storage property or similar commercial real estate properties for sale, our broker team is ready to assist with the growth, expansion and management of your portfolio. Contact the team by calling 844.4.SIG.NNN or check out our current self-storage listings to get started with your next self-storage investment.
When conducting a 1031 exchange, investors can utilize a 1031 exchange intermediary for an easier process. The term 1031 exchange comes from the Internal Revenue Code (IRC), section 1031, which states, “No gain or loss shall be recognized on the exchange of real property held for productive use in a trade or business or for investment if such real property is exchanged solely for real property of like kind which is to be held either for productive use in a trade or business or for investment.”
As an investor searches for their next property opportunity, there are many different types of real estate that may jump out as a possibility. From fast food restaurants to strip malls and everything in between, real estate can be a lucrative investment opportunity. In 2021, especially, it can seem like there are many good options for investments. One such investment that can add significant value to a growing real estate portfolio is a CVS for sale.
If you’ve been researching investment opportunities in commercial real estate, you have probably come across many terms you are unfamiliar with. It can seem overwhelming to figure out if investing in real estate is truly what you want, especially when you don’t understand what is being discussed.
Investors are always looking for the next opportunity. Whether you are new to commercial real estate investments or you have a robust portfolio already, a convenience store for sale might make a great addition to your portfolio. Convenience stores are always in demand, and are found in just about every city, town, or community across the country. A convenience store or c-store meets the essential needs of their communities and considered recession-proof, too, as customers will stop to buy what they need even if they don’t have a ton of disposable income, especially if the store is located in a good area near people’s work, home, or commute.
Investors are seeking triple net properties that can generate robust returns, even during market downturns. Another requirement is selecting brick-and-mortar retail properties with the ability to compete with e-commerce as consumers purchase more and more items online. One category of retail property fits these prerequisites to a ‘T’—an auto parts store or business for sale, which may be one of the industry’s best-kept secrets.
Investors who desire optimal opportunities for triple net lease properties may not have considered 7-Eleven stores. 7-Eleven is a known for its Slurpee drinks, but people may not realize that it is the world’s largest convenience store business. It’s consistently ranked as a top-10 franchisor and boasts of 69,000 stores in 17 countries; more than 10,000 company-owned and franchise stores are located in North America. In 2021, Entrepreneur magazine rated it ninth in its ranking of the top 500 franchises.
As investors seek the next right opportunity to add to their portfolios, there are a number of businesses that can make a good fit. Sometimes, investors have focused solely on one type of business in the past, but may be looking to expand into a new industry. Other times, an investor might be looking to sell off one property and invest in another one. And yet other investors simply want to add to their portfolio in an industry that they know will not be going away any time soon.
From medical offices to strip malls and everything in between, real estate investors are constantly looking for the next investment opportunity to expand their portfolios. There is no shortage of investment opportunities, after all, and nearly every industry needs dedicated investors to help them succeed especially when investing in businesses for sale. As an investor, growing your portfolio and seeing a profit on those investments is undoubtedly important to you. Finding the right investment is key to that success.
Reflecting on one year into the COVID-19 pandemic in the United States, we’ve seen an acceleration of the medical sector’s already-booming market outlook, especially as it relates to urgent care facilities. Even before the pandemic, medical clinics were progressively popping up in retail strips and main shopping centers, and around busy commercial offices. Investors are seeking urgent care real estate as a growing sector with stable vehicles to safely invest their money.
Pre-pandemic urgent care facilities were primarily serving the general public for urgent and immediate care needs—however, in a post-pandemic world, research indicates that consumers will prioritize preventative wellness and urgent care centers will see an increase in visitors.
As a result, urgent care centers have come into the mainstream as a new opportunity for private equity, commercial real estate, and retail healthcare individuals. There are big opportunities for investors to take advantage of properties that lean into convenience for the community, especially when it comes to preventative care.
Community urgent care offices offer:
- Convenient access to everyday shopping
- A safer medical environment than hospitals
- Shorter wait times than alternative care options
- Lower patient costs than alternative care options
THE BENEFITS OF BUYING URGENT CARE REAL ESTATE
As the sector continues to grow and investors flock to medical offices and modern urgent care facilities, it’s important to understand the benefits as they relate to urgent care as a real estate investment.
Urgent care is ecommerce-, recession-, and pandemic-proof
As we’ve seen over the last 12 months, urgent care facilities have seen an increase in demand from the COVID-19 pandemic, and research indicates that this trend has staying power as preventative health becomes a priority for everyday consumers and the democracy of healthcare accelerates into communities. Check out Urgent Care facilities on the market.
Urgent care provides a proven business model with a strong track record
Healthcare will always be an essential service, and there will always be a demand for urgent care facilities for both medical emergencies and everyday healthcare needs. These facilities support the needs of their communities by offering accessible and convenient options for medical services.
Urgent care centers incur high moving costs when switching facilities
In many cases, urgent care centers provide specialized services with spaces built around specific equipment and providers. If an urgent care practice were to move, the tangible financial cost would be high, which prevents high tenant turnover. Urgent care clinics also typically serve a five-mile radius in surrounding neighborhoods, and the intangible financial cost of losing clients and credibility from a move would be incredibly high.
THE BENEFITS OF SELLING URGENT CARE REAL ESTATE
For owners looking to sell their urgent care businesses and properties, there are two ways a net lease advisor can help structure a deal that identifies the increased value of urgent care facilities, while structuring a transaction that works best for the operator in the long term.
Unlock Capital with a Sale Leaseback
A growing number of urgent care owner-operators are looking to structure a sale leaseback as a way to free up the maximum amount of equity in their property. A sale leaseback is a financing tool that allows an owner-operator to sell their real estate interests to a buyer while simultaneously signing a long-term lease to occupy the property as a tenant and secure the location.
By separating the real estate from the core business, urgent care owner-operators can achieve significantly higher real estate values. Sale leasebacks provide flexibility in allowing owner-operators to sell their real estate while maintaining the freedom to partner their practice with a multi-unit operator down the line.
With a sale leaseback, the owner-operator can pull out 100% of the equity to invest into another project while still controlling the core business. Oftentimes this capital is used to open additional practices, expand their current practice, or acquire another practice or real estate property.
Sale leasebacks are being used across the healthcare industry and are starting to become more prevalent in the urgent care sector, demonstrating their numerous benefits.
Gain Benefits From a Long-Term NNN Lease
Many urgent care owner-operators have built up their practices by taking ownership of the real estate, then growing their practice within it—and oftentimes, they own both the real estate and the urgent care business itself. Because of this, owners are often surprised to learn that a sophisticated investor may value their building more than the standard real estate appraisal. When a multi-unit operator proposes to acquire an urgent care practice, they are solely focused on the business, not the real estate.
However, investors are looking to add these businesses to their portfolios for the long term, so buying a practice from an urgent care operator while simultaneously signing a long-term lease has become an increasingly attractive option. These leases are usually NNN and are very marketable to outside investors.
About Sands Investment Group
Sands Investment Group has extensive experience in all types of commercial real estate and is an industry leader in the urgent care net lease investment space. We can help you navigate and advise you on how to leverage your existing assets in the current economic climate and create capital to fund your future investments.
With over 2,400 transactions in 48 states valued in excess of $5 billion since 2010, Sands Investment Group is the fastest growing net lease investment company in America. We provide highly personalized client services, employ innovative marketing techniques, and have access to an extensive network of investors to help you find the perfect investment or sell a property you own for the best profit. Call 844.4.SIG.NNN or send us an email to get started.
Shopping centers can be a great opportunity for commercial real estate investors. They offer variety in tenants, consistent income, and great potential for growth in the future. A shopping center can look very different, depending on the town or city, as well as the types of tenants the center tends to attract. Some may have a lot of chain stores, while others might have mostly local businesses. There may be a mix of retail, grocery stores, clothing stores, and furniture stores. Oftentimes, there can be many moving parts with shopping center investments, as there are usually multiple retail tenants to manage at any given time.
Whether you have medical experience or are just interested in investing in medical offices because they can make a great long-term investment, medical office properties can be a great addition to any commercial real estate portfolio. There are so many different types of medical properties that can be an asset—from small offices for private practice to large medical buildings or complexes.
In 2021, childcare assets are a product type to watch for commercial real estate investment opportunities. These assets are ideal additions to a net lease portfolio that provide long-term benefits and witness current growth as the industry bounces back from the COVID-19 pandemic. Childcare assets commonly provide long-term leases, corporate tenants with valuable reputations, strong operators, and—perhaps most importantly—owners who are highly committed to their businesses. These owners are passionate about their programs as they genuinely want to see children receive a quality education and care at their facilities.
Restaurants have become popular investments in recent years as busy consumers choose to dine out more frequently—sometimes more than one meal a day. Examining the growth of the industry by its share of consumers’ food dollar and total sales is impressive. The restaurant industry’s share of the food dollar climbed from 25% in 1955 to 51% now, and total US sales have climbed 53% in the past decade to $899 billion, according to the National Restaurant Association. Currently, there are more than 1 million restaurant locations in the United States.
Nevertheless, the industry was negatively impacted by the COVID-19 pandemic that began in March 2020 and led to the closure of many restaurants due to temporary regulations that restricted inside dining. The restaurant industry’s total sales for 2020 were $240 billion less than the National Restaurant Association’s pre-pandemic forecast for the year. Also, more than 110,000 eating and drinking places were closed for business temporarily, or for permanently, as of December 1, 2020.
The pandemic was challenging for restaurants of all sizes, but the companies that fared better tended to be larger franchises that have outlets throughout the country and feature what is described as omnichannel platforms—restaurants that provide several ways for customers to order, pay, and get their meals. Today, consumers desire a consistent experience, no matter the sales channel they use.
Generally, fast food restaurants were able to pivot quickly and adapt to operating during the pandemic. Many fast food restaurants already featured drive-throughs and online ordering with contactless curbside carry-out.
Investing in Restaurants: The Basics
If you’re interested in investing in small restaurants for sale, buying an existing restaurant property can be an excellent option to become a restaurant owner. You can avoid the difficult early years of getting a restaurant off the ground. As with buying a restaurant franchise, you gain instant name recognition and a built-in customer base. Also, you do not have to create a business plan and menu from scratch. But, in a purchase, you inherit both the good and the bad, and it’s crucial to ask the right questions before investing in restaurant properties.
Questions to ask before purchasing a restaurant property:
1. Why Is the owner selling the restaurant?
This is the most critical question—why does the owner want to sell the restaurant if it is successful? Typically, two main reasons cause owners to sell:
- The owners may want to retire, or they may be weary of being their own bosses. Operating a restaurant is a tough job, and the long hours can take a toll. Health complications, family issues, or other personal problems may make some people decide to sell. If it is not working for the owners, you should be confident that you are ready to run it.
- They may not be making sufficient money to meet their costs and want to make the restaurant for sale sooner than later, before incurring a greater loss.
2. How are the restaurant’s financials?
Before you purchase a restaurant, you need to know if it will be a viable business. No matter how much you love that taco place or how successful it seems, you must carefully examine its financials along with the asking price. The due diligence will make you aware of any significant issues from the outset. In fact, if you plan to apply for a small business loan, you must create a detailed outline of the finances for your restaurant business plan.
You and your accountant must scrutinize all the financials, including profit and loss, cash flow statements, balance sheets, bank records, and tax history. Things you should look at include food and beverage sales (monthly and yearly), labor costs, food costs and check averages. Also, look at the cost of utilities, rent, insurance and taxes. Examine existing vendor contracts and the state of any assets (especially equipment) you will be purchasing. Look at the liabilities you would be taking on—to whom will you owe money, how much, and what are the monthly payments?
If an owner refuses to show you the books, do not proceed any further. Anyone serious about selling should provide an accurate picture of the financial health of their restaurant. The owner may ask you to sign a non-disclosure agreement stating that you will not share their information with any other parties.
3. Are There Any Tax Problems or Legal Issues?
Restaurant closures are often due to failure to pay sales or payroll taxes. These obligations compound quickly under government penalties, and you want to avoid these types of problems. Other legalities to look for: unpaid wages, customer lawsuits, back rent, health department citations, and more. It may be wise to hire an attorney to review all public records to avoid these issues.
4. How Is the Location?
Unless you are already familiar with the restaurant for sale, you should research the area and ask yourself several questions to help determine it’s value and fit within your portfolio. Questions including but not limited to: Is the location advantageous, is it located in a busy area? Is the restaurant in a shopping center or is it standalone? Is it visible enough to attract foot traffic and passing cars? Is there sufficient parking? What is the competition like nearby? Have new restaurants opened that might draw business away? What are the future terms of the lease?
Fast Food Restaurant For Sale Opportunities
A profitable way to invest in the restaurant niche is to select a quick-service restaurants AKA fast food restaurants for sale, with a triple net lease (NNN). Due to the great variety of fast food restaurants, investors can choose the property they want to invest in based on location, price, and brand. Choosing a name brand also eliminates the risk of a local restaurant having a poor reputation. There are several reasons why fast food restaurants that are available to buy make great NNN investments, including location, drive thru access, type of business and lease length.
There are more than 200,000 fast food restaurants in the US and, according to Brand Z rankings, and 2018 revenue for the top eight fast-food brands was $229 billion. Entrepreneur and QSR Magazine report that McDonald’s, Starbucks, and Subway are among the top fast food restaurant brands. They have continued to perform well during the pandemic with the advantage of drive thru service, making the industry an excellent place to invest. Fifty million Americans dine at a fast-food restaurant every day. Restaurants like McDonald’s, KFC, Wendy’s, and Starbucks are stable long-term net lease investments with reliable, creditworthy tenants, effortless monthly income, periodic rent increases for 10-15 years, and few or no maintenance responsibilities.
Many restaurant corporations depend on triple net (NNN) leases investors to expand and open new locations, which creates a profitable circumstance for both property owners and the fast-food corporations.
NNN real estate provide a bevy of benefits that enable buyers to continue to work, build a portfolio, or enjoy retirement. To make the most of those benefits, look for high-credit companies that choose total control over their properties and brand image without involvement from the landlord. You also want to make sure the investment provides:
- Low-risk reliability/creditworthy tenant financials and reporting
- Expense-free ownership with stable monthly income
- Corporate-backed lease guarantee for 10-15 years with extension options
- Rental increases during the lease term to offset inflation
- Preservation of wealth and investment diversification
- The chance to build equity over the lease term
1031 Exchange Investors and Restaurants
In addition to NNN investors, 1031 exchange investors are turning to restaurants as replacement properties because these asset types are easy to understand, and buyers like the familiarity with the brands and the ability to their favorite name brand. In addition, restaurants that are clearly growing are particularly attractive, especially since the typical price point (between $2-$3 million) is perfect for individual investors.
The triple net real estate experts at Sands Investment Group have helped investors close deals on many fast food restaurants, including various locations like:
- Steak N’ Shake locations in Indiana and South Carolina
- Starbucks outlets in California, Florida and Arkansas
- Panera Bread locations in California, North Carolina and Virginia
The trusted advisors at Sands Investment Group can bring more to the table than simply identifying properties for you. We can help with existing real estate assets, acquiring new operators or businesses, developing new restaurants, and working to restructure leases to reduce your costs. We have handled one-off deals and acquisitions of multiple restaurant locations to help you obtain the right restaurant for your portfolio. If you have a different net lease property type in mind, we can help. We’ve handled deals on some of the most popular NNN business types including: car washes for sale, gas stations for sale, and many more.
For more information or to begin finding your next restaurant for sale investment, get in touch with Sands Investment Group experts. These advisors can help identify and secure a great opportunity for investment. Call 844.4.SIG.NNN or send us an email to get started.
As investors look into new opportunities for triple net lease properties, one type of business that’s repeatedly mentioned is a gas station. The best types of commercial real estate leases involve relationships with businesses that are recession-proof, meaning they will always be needed regardless of the current economy. Therefore, gas stations are a smart investment opportunity to consider.
With its sandy beaches, rolling mountains, and bustling cities, North Carolina features natural beauty, culture, and industry such as furniture manufacturing in High Point and hi-tech in Raleigh, Durham and Chapel Hill, the research triangle region.
With a population close to 11 million, North Carolina is the 28th largest and 9th most populous U.S. state. Raleigh, the state capital, has a population of about 474,000 people (2.2 million for the entire triangle region), while Charlotte has 870,000 residents. However, recent data collected by the U.S. Census Bureau records that both urban areas rank among fastest-growing U.S. cities.