Dollar General, Moscow, PA
Close date: January 27, 2020
All-Cash Texas Buyer Invests in Rare Dollar General Property
In the autumn of 2019, an experienced Texas multi-family property owner became increasingly interested in the low-maintenance nature and reliable income opportunities of NNN lease property ownership.
He had performed preliminary NNN investment research hoping to self-educate and purchase a property on his own, however, after a few weeks, he realized there was much more to the process than he imagined. Consequently, he reached out to a well-known industry buyer’s broker, Chris Schellin at Westwood Net Lease Advisors, for cost-free guidance.
Within a few months of working together, not only did this new all-cash NNN investor buy a rare Dollar General relocation in Moscow, PA, he began planning his next NNN purchase.
To begin, Schellin spent a couple of months understanding the client and his financial goals, educating him on the market, and assessing many different NNN property types and locations. After this initial stage of the process, they then went to work identifying specific locations.
Schellin analyzed the different lease details for the variety of properties under consideration, and, after thorough evaluation and studying the pros and cons of many available fast food, auto parts, medical, and retail properties, the buyer decided to invest in a Dollar General.
Just as they decided to focus on Dollar General properties, Schellin learned of this pre-construction store relocation. The ability to purchase a newly constructed property in conjunction with a proven store sales history and a full-term, 15-year lease with no landlord responsibility made this Dollar General too good to pass up. Once Schellin performed due diligence on the property and lease, they began the purchase process and closed within 30 days.
NNN Dollar General Properties Offer Many Options
This property offered a unique opportunity as Dollar General stores do not typically relocate. In this case, the existing in-line store was smaller than the national prototype 9100 sq. ft. yet performing so well, Dollar General made the decision to construct a brand new, much larger building in the immediate vicinity.
The company also included a new long-term, corporate-guaranteed, absolute NNN lease in the deal rather than offer the remainder of the lease from the old location. Since the store was already profitable, the Texas buyer had the extra assurance and peace of mind that this property would be a worry-free investment.
Aside from this specific Dollar General being a great investment, Westwood keeps an eye on all Dollar General properties for prospective buyers as they tend to offer stable, straightforward net operating income with lower risk than other non-essential businesses.
Dollar General has over 16,000 stores in 45 states with plans to add approximately 1000 strategic locations annually. Properties typically sell in $1-2 million range, making them ideal for a first-time buyer or as an addition to the seasoned investor’s portfolio.
To Wrap it Up – NNN Dollar General All-Cash Relocation Results
Thanks to a successful advisor-buyer alliance, this Texas-based all-cash investor now benefits from a management-free Dollar General property that offers a reliable monthly income and a 6.60% cap rate for the next fifteen years.