US BANK 10 Year Absolute NNN Lease
About the Investment
Our team sold a STNL asset containing US Bank Corp. as the tenant and guarantor. The property sold to an all-cash buyer in a 1031 exchange at full asking price (5.0% cap rate).
Challenges
- Location showed poor demographics and dilapidated properties nearby.
- Very low deposits in relation to other similar assets.
- Flat rental rate through lease term (10 years).
Solutions
- Property was positioned 1/8th of a mile from the highway and situated at a hard corner. This allowed us to mitigate location concerns.
- Tenant had operated at that location for over 25 years. They would not have renewed on a 10-year deal if they were not comfortable with the deposits.
- US Bank and other similar user shave indicated interest in moving away from longer term deals by signing 5-year deals. The fact that this was a 10 year was a win for any prospective buyer.
