Investment Real Estate topics throughout California and sometimes further! Mario Pinedo has been a Realtor since 1991 in Silicon Valley and has sold throughout California and the West. His primary investment vehicle is multi-family rental properties. Mario focuses on major markets from San Diego, Orange County, Los Angeles, San Jose, San Francisco and northern California. He currently lives in Irvine, CA.
Thursday, November 30, 2006
75 years flat lease for a Walgreen's???
I was just reviewing a package for 5 brand new Walgreen's NNN investments through the South. Flat leases for the initial 25 year term which is acceptable with such a high quality tenant. But, the remaining 50 years of 5 year options are flat too!! And the initial cap rates are between 6% and 6.2% Not very attractive. In my opinion, these deals will sell, but some buyer is not taking in to account the depressed value of these deals over the next 5 decades. And let me ask, How many retailers have survived any 75 year span?
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