Dollar General, Elm Creek, NE
Close date: January 28, 2020
Cap 7.25%; NOI: $88,000
All-Cash Buyer Provides Specific NNN Requirements & Gets Even More
Even experienced NNN lease investors can benefit greatly from working with a buyer’s advisor, just as a client of Phil Bundren at Westwood Net Lease Advisors learned. An all-cash buyer reached out to Bundren and explained that he wanted to buy very specific types of properties – absolute NNN with a minimum 15-year, whole-term, corporate-guaranteed lease, and no less than a 7% cap rate. Because NNN properties with these characteristics are highly desirable, they are often difficult to locate, and they sell fast. Had it not been for Bundren keeping his finger on the pulse of the market and acting swiftly when a brand-new Dollar General in Elm Creek, Nebraska, became available, his client would’ve missed a perfect investment opportunity.
How NNN Advisor Bundren Located the Ideal Investment
Though this investor was very familiar with how the NNN investment process worked, he relied on Bundren to find the perfect property to suit his needs so he could carry on with business and not be bothered with the particulars of the property search. Since Bundren and the Westwood team have national connections and knowledge of properties coming to market, often before they’re advertised, they help their clients find exactly what they’re searching for and act quickly to secure the investments that fit their goals.
That’s exactly what happened with this property.
Once Bundren located the Elm Creek Dollar General, he contacted the buyer, who was thrilled with the prospect of owning this Dollar General, and they started negotiations with the developer to buy the property. Bundren helped him secure a lower purchase price, from $1,257,350 to $1,214,000, and a higher cap rate of 7.25%, up from 7%. The lease terms fit the buyer’s criteria of a whole-term, 15-year, absolute NNN, corporate-guaranteed lease, with three renewal options every 5 years, and 10% rental increases at each renewal. For the first 15 years, the buyer will earn $88,000 per year, with the potential of $117,150 annually if the tenant exercises all renewal options. If Bundren had not found this property and helped his client act fast, this Dollar General would have been snapped up by another investor.
A Buyer’s Advisor Earns Investors Money
By partnering with a specialized, well-known buyer’s advisor with a thorough approach as his personal representative, it ensured this buyer bought the right NNN property for his financial and lifestyle goals without losing money and wasting time.
Quite often, when you find a property on your own that seems like a perfect fit, your advisor may uncover reasons why it is not the optimal option for you and show you other properties that better represent your goals. Advisors use tools and technology that aren’t available to the general public, provide in-depth market knowledge, help you decode inflated cap rates, avoid mistakes, negotiate on your behalf, provide financing sources, structure the deal, and more. These benefits often equate to capital preservation and a higher return on your investment.
Without an experienced buyer’s advisor, you may end up in a complicated, lengthy process that wastes valuable time and extra money and ends with you owning a less-than-ideal property or nothing at all.
Whether you are new to NNN investing or a seasoned buyer, Westwood Net Lease Advisors starts by getting to know you and your goals. Then, we help you find an investment that fits your criteria, including some you may not have considered. Our company is unique in the industry as we are the only NNN specialists in the nation who primarily represent buyers and provide representation to clients – from the property search to closing – at no cost to the buyer.
To Wrap It Up –Engage a Westwood Advisor & Cash-In with NNN Properties
Just as Bundren’s client discovered, nothing outweighs the benefits of a specialized NNN advisor when it comes to investing your hard-earned money and getting the best NNN investment for your goals. Thanks to this advisor-buyer alliance, a new Dollar General store has an experienced landlord and the buyer benefits from exactly what he wanted – a responsibility-free, reliable monthly income at a 7.25% cap rate for the next fifteen years.