C-stores in secondary markets are experiencing strong demand.
Hanley Investment Group Real Estate Advisors announced it has completed the sale of three 7-Eleven properties in separate transactions for a combined value of almost $4.3 million. The properties are located in Valley Park, Mo; Bradenton, Fla; and Lakewood, Ohio.
“These sales highlight the continued demand for single-tenant net-lease corporate-guaranteed 7-Eleven properties and investors’ willingness to look outside of major metros to find them,” said executive vice president Jeremy McChesney.
McChesney has now completed the sale of 26 7-Eleven properties in less than three years.
According to McChesney, S&P Global Rating gives 7-Eleven an investment-quality crediting rating of “AA-.”
“All three 7-Eleven properties that transacted had good fundamentals including absolute triple-net leases and high-profile locations with good traffic counts, demographics, proximity and ease of access to major thoroughfares plus they were backed by 7-Eleven corporate,” said McChesney.
From December 2016 through December 2017, 84 7-Elevens traded across the country with an average cap rate of 5.61%. What is interesting to note is that nearly half of these buyers were from California. The average sale price for a 7-Eleven during this period was $2.165 million and ranged as high as $5.9 million and as low as $305,000. As of Jan. 1, 2018, there were 70 7-Elevens listed for sale.
“We expect that sales volume for single-tenant 7-Eleven net-leased investments to stay strong in 2018,” said McChesney. “Existing properties with an extensive history and newly-minted long-term leases should continue to be in the highest demand and trade in the high four-percent to six-percent cap rate range. Properties with a shorter lease term located in areas with strong real estate fundamentals will also remain in high demand. Investors like single-tenant 7-Eleven properties for their residual value since they are typically located in high-traffic corridors and fundamentally-rich locations.”