RealSource Group, a national commercial real estate brokerage company focused on retail, healthcare and automotive properties, announced today that the firm arranged the sales of two, brand-new, single-tenant net-leased investments occupied by 7-Eleven and a fuel station in off-market transactions in Houston and Arlington, Texas.
In Houston, Vice President Austin Blodgett, in association with ParaSell, Inc., represented the seller, a private developer based in Houston, for the pre-sale of a brand new, single-tenant net-leased investment occupied by 7-Eleven, Laredo Taco Company quick-serve restaurant, and a fuel station. Chuck Klein, executive director with Cushman & Wakefield of San Diego, California, represented the buyer, a private investor based in Southern California. Although the purchase price could not be disclosed, the sale achieved a cap rate of 4.5% in the off-market transaction.
“We began marketing the single-tenant 7-Eleven while it was still in the early stage of construction and generated multiple offers within the first week of marketing,” said Blodgett. “We secured an all-cash, Southern California-based buyer who was looking for a brand-new construction 7-Eleven property in a tax-free state. One of the main selling points on this deal was that it was a build-to-suit; in this case, 7-Eleven put up nearly all of the capital necessary to build the fuel station portion of the project, which clearly showed the tenant’s commitment to this location.”
7-Eleven is located at the signalized intersection of Broadway Street and Rockhill Street at 8550 Broadway Street, with 30,000 cars per day. 7-Eleven, which opened on June 10th, occupies a 4,842-square-foot building on 1.1 acres with a new absolute, triple-net 15-year lease.
“This is a great location with excellent visibility, a large 48-foot pylon signage directly on Broadway Street, and less than 1 mile from Houston’s Hobby International Airport with over 50 million passengers annually,” noted Blodgett. “7-Eleven has little to no competition within a 3-mile radius and is in the direct driving path for rental car returns and major overnight paid parking lots at Houston Hobby Airport. The property is also within walking distance to more than 3,500 apartment units and hundreds of single-family homes.”
Blodgett adds, “Along with gas and c-store sales, 7-Eleven and the developer expect that this site will do extremely well with Laredo Taco QSR, providing a steady flow of additional income to this store.”
In Arlington, RealSource’s Blodgett, along with ParaSell, Inc., represented the seller, a private developer based in Houston. Jeremy McChesney, executive vice president with Hanley Investment Group, represented the buyer, a private investor based in Southern California. Although the purchase price could not be disclosed, the sale achieved a cap rate of 4.7% in the off-market transaction.
“We helped secure an all-cash, California-based 1031 exchange buyer who was looking for a brand-new construction 7-Eleven property for their upleg,” said Blodgett. “We negotiated that the buyer was non-contingent months before the store opened for business or started paying rent. However, due to the buyer’s 180-day exchange deadline ending before the scheduled close of escrow (which was tied to 7-Eleven’s opening and the payment of rent among other things), we structured two different closings. The first closing occurred early to meet the buyer’s 1031 exchange deadline requirement, and certain funds were held in escrow until the store opened, which triggered the second closing and final disbursement of funds.”
Blodgett added, “This was a unique loophole to get around the 180-day exchange closing deadline in a situation where construction was delayed beyond the buyer’s exchange deadline and the buyer did not want to close escrow until the store opened. We often see delays on new construction transactions, and we were able to work with the buyer to get them comfortable with this type of closing structure to make the deal work.”
The property is located at the signalized intersection of Collins Street and Blue Lake Blvd. at 4016 N. Collins Street, the main north-south corridor in the Arlington area. 7-Eleven, which opened on June 10th, occupies a 3,010-square-foot building on 1.3 acres with a new absolute, triple-net 15-year lease.
According to Blodgett, “7-Eleven is one of the most popular, recession-proof and internet-resistant net lease investments available today. In the last six months, 19 new-construction 7-Eleven deals have traded in Texas and, with the company’s growth and expansion plans in states like Texas, along with the population growth in these areas, we can expect to see a lot more of these transactions over the next year. The increased demand from buyers for new 7-Eleven builds will put pressure on cap rates to compress and pricing will continue to grow.”