Showing posts with label sales. Show all posts
Showing posts with label sales. Show all posts
Thursday, September 27, 2012
Commercial Property Sales Outlook
Commercial Property Sales Outlook for U.S. Cut by ULI
The Urban Land Institute cut its forecast for U.S. commercial real estate sales by 12 percent to $748 billion through 2014 because projections for economic growth are “down considerably” from six months ago.
Deals for properties such as office buildings, shopping centers and warehouses probably will be $223 billion this year, $250 billion next year and $275 billion in 2014, according to a ULI survey released today of 39 economists and analysts from real estate investment, advisory and research firms. In a March report, sales were forecast at $250 billion this year, $290 billion next and $312 billion in 2014.
REIT Returns
One projection boosted from the last survey was for the performance of real estate investment trusts. Annual returns for equity REITs are forecast to be 15 percent this year and 10 percent both next year and in 2014. That’s up from the previous forecast of 10 percent this year, 9 percent next and 8.5 percent in 2014, the institute said.
http://www.businessweek.com
Thursday, April 12, 2012
Rite Aid 4Q Loss Narrows Amid Sales Growth
Rite Aid recently reported total drug-store sales of $7.12 billion, up 11% from a year earlier, mostly owing to an extra week of sales in the period. Same-store sales improved 3%, the drug-store chain's best showing in five years. Last week, Rite-Aid said that March same-store sales improved further, up 3.6%.
Looking to fiscal 2013, Standley said Rite Aid intends to remodel 500 stores into the wellness format and will focus on the Wellness+ program as the core component of the company's overall marketing and promotional efforts.
For the year, the company projected a per-share loss of 13 cents to 31 cents on revenue of $25.4 billion and $25.8 billion. Analysts polled by Thomson Reuters recently expected a loss of 25 cents and revenue of $25.74 billion. Rite Aid expects same-store sales growth of up to 1.5% over the just-completed fiscal year.
http://online.wsj.com/article/BT-CO-20120412-711339.html
Looking to fiscal 2013, Standley said Rite Aid intends to remodel 500 stores into the wellness format and will focus on the Wellness+ program as the core component of the company's overall marketing and promotional efforts.
For the year, the company projected a per-share loss of 13 cents to 31 cents on revenue of $25.4 billion and $25.8 billion. Analysts polled by Thomson Reuters recently expected a loss of 25 cents and revenue of $25.74 billion. Rite Aid expects same-store sales growth of up to 1.5% over the just-completed fiscal year.
http://online.wsj.com/article/BT-CO-20120412-711339.html
Friday, October 21, 2011
Net lease Market one of the Hottest Commercial Real Estate plays in the Country
With money to burn but still having a strong aversion to risk, investors have increasingly turned single-tenant properties into one of the hottest commercial real estate plays in the country.
The single-tenant, net lease investment sales market is expected to continue growing, according to Jones Lang LaSalle.
"The low interest rate environment and the lack of safe-haven investment alternatives are driving new sources in build-to-suit and sale-leaseback activity, and investors have incredibly healthy appetites for stable and dependable income streams that single-tenant assets provide," said Guy Ponticiello, managing director Jones Lang LaSalle's Corporate Finance & Net Lease division.
Fully leased core properties have been highly sought-after by investors, often from overseas, and prices for these properties have been strong, according to Jane L. Mendillo, president and CEO of Harvard Management Co. in her most recent Harvard University Endowment report.
"We were able to sell some of our portfolio properties in this category at excellent values," Mendillo said. And now Harvard is ready to invest in new round of such properties.
http://www.costar.com/News/Article/Single-Tenant-Property-Sales-Surge-To-Record-Numbers/132751
The single-tenant, net lease investment sales market is expected to continue growing, according to Jones Lang LaSalle.
"The low interest rate environment and the lack of safe-haven investment alternatives are driving new sources in build-to-suit and sale-leaseback activity, and investors have incredibly healthy appetites for stable and dependable income streams that single-tenant assets provide," said Guy Ponticiello, managing director Jones Lang LaSalle's Corporate Finance & Net Lease division.
Fully leased core properties have been highly sought-after by investors, often from overseas, and prices for these properties have been strong, according to Jane L. Mendillo, president and CEO of Harvard Management Co. in her most recent Harvard University Endowment report.
"We were able to sell some of our portfolio properties in this category at excellent values," Mendillo said. And now Harvard is ready to invest in new round of such properties.
http://www.costar.com/News/Article/Single-Tenant-Property-Sales-Surge-To-Record-Numbers/132751
Wednesday, August 24, 2011
Wall Street Banks Plan $5 Billion in CMBS Sales
Wall Street banks are planning to sell as much as $5 billion of bonds tied to commercial mortgages as they offload loans agreed to before credit markets stumbled and amid growing concern that the economy is faltering.
The securities will be offered in September and October, bringing 2011 sales to about $25 billion, according to Julia Tcherkassova, a commercial-mortgage debt analyst at Barclays Capital in New York....
http://www.businessweek.com/news
The securities will be offered in September and October, bringing 2011 sales to about $25 billion, according to Julia Tcherkassova, a commercial-mortgage debt analyst at Barclays Capital in New York....
http://www.businessweek.com/news
Tuesday, May 10, 2011
McDonald’s April Sales Rise 6%
McDonald’s Corp. (MCD), the world’s biggest restaurant chain, said sales at stores open at least 13 months rose 6 percent in April as smoothies and McCafe beverages drew customers in the U.S.
Analysts projected comparable-store sales would rise 4.1 percent, according to the average of seven estimates compiled by Bloomberg News. Sales in the U.S. climbed 4 percent, the Oak Brook, Illinois-based company said today in a statement.
http://www.bloomberg.com/news
Analysts projected comparable-store sales would rise 4.1 percent, according to the average of seven estimates compiled by Bloomberg News. Sales in the U.S. climbed 4 percent, the Oak Brook, Illinois-based company said today in a statement.
http://www.bloomberg.com/news
Thursday, February 10, 2011
Whole Foods Rises After Boosting Annual Profit, Sales Goals
Whole Foods Market Inc., the largest U.S. natural-goods grocer, surged the most in more than three months after raising its annual forecasts, buoyed by freer- spending consumers prepared to pay for healthy food.
Earnings will be as much as $1.80 a share in 2011, the company said yesterday after markets closed. That compared with a previous target of as much as $1.71. The Austin, Texas-based grocer also raised its sales growth forecasts for the year, citing increasing consumer confidence.
www.bloomberg.com
Earnings will be as much as $1.80 a share in 2011, the company said yesterday after markets closed. That compared with a previous target of as much as $1.71. The Austin, Texas-based grocer also raised its sales growth forecasts for the year, citing increasing consumer confidence.
www.bloomberg.com
Friday, February 4, 2011
Yum Brands Has Big Growth Plans For 2011
Yum Brands — The world's largest restaurant company: KFC, Pizza and Taco Bell
The parent company of Taco Bell, KFC and Pizza Hut has big growth plans for 2011, especially in China and other emerging markets, but executives said during a conference call that they expect hurdles, such as commodities inflation and the effect of lapping a particularly successful 2010, to keep them on their toes.
Yum is coming off a strong year, with fourth-quarter profit up 27% over the prior year. Chief Financial Officer Richard Carucci said Yum estimates its 2011 commodities costs will be up 4% in the U.S., 5% in China, and 3% in its international division, YRI.
While Yum's commodities contracts have it fairly locked in for the year, Carucci said, if food costs don't come down, the company has about $40 million of further exposure: $25 million in China and $15 million in the U.S.
Yum recently raised prices in China, to offset both commodities and wage inflation in the country, and said sales remain strong. Other companies, such as McDonald's Corp. (MCD), Yum's biggest fast-food competitor, have also been forced to increase their prices in China.Thanks to strong sales in China, the restaurant operator's fourth-quarter earnings climbed 26% to 63 cents a share, beating views for 60 cents. Total sales grew 6% to $3.56 billion, also above expectations.
In the U.S., Yum said it plans to grow its Taco Bell locations to 8,000 from 5,000.Yum! Brands, Inc., based in Louisville, Ky., is the world's largest restaurant company in terms of system restaurants with more than 37,000 restaurants in over 110 countries and territories and more than 1 million associates. Yum! is ranked #216 on the Fortune 500 List, with nearly $11 billion in revenue in 2009. Four of our restaurant brands – KFC, Pizza Hut, Taco Bell and Long John Silver's – are the global leaders of the chicken, pizza, Mexican-style food and quick-service seafood categories.
Article published by the Wall st Journal.-By Annie Gasparro, Dow Jones Newswires; 212-416-2244; annie.gasparro@dowjones.com
Yum is coming off a strong year, with fourth-quarter profit up 27% over the prior year. Chief Financial Officer Richard Carucci said Yum estimates its 2011 commodities costs will be up 4% in the U.S., 5% in China, and 3% in its international division, YRI.
While Yum's commodities contracts have it fairly locked in for the year, Carucci said, if food costs don't come down, the company has about $40 million of further exposure: $25 million in China and $15 million in the U.S.
Yum recently raised prices in China, to offset both commodities and wage inflation in the country, and said sales remain strong. Other companies, such as McDonald's Corp. (MCD), Yum's biggest fast-food competitor, have also been forced to increase their prices in China.Thanks to strong sales in China, the restaurant operator's fourth-quarter earnings climbed 26% to 63 cents a share, beating views for 60 cents. Total sales grew 6% to $3.56 billion, also above expectations.
In the U.S., Yum said it plans to grow its Taco Bell locations to 8,000 from 5,000.Yum! Brands, Inc., based in Louisville, Ky., is the world's largest restaurant company in terms of system restaurants with more than 37,000 restaurants in over 110 countries and territories and more than 1 million associates. Yum! is ranked #216 on the Fortune 500 List, with nearly $11 billion in revenue in 2009. Four of our restaurant brands – KFC, Pizza Hut, Taco Bell and Long John Silver's – are the global leaders of the chicken, pizza, Mexican-style food and quick-service seafood categories.
Article published by the Wall st Journal.-By Annie Gasparro, Dow Jones Newswires; 212-416-2244; annie.gasparro@dowjones.com
Tuesday, February 1, 2011
Triple-Net-Lease Properties Returns are More Favorable
Triple-net-lease properties' returns are more favorable and more secure than some traditional investment vehicles
By: David Sobelman, Executive Vice President, Calkain Cos.
As published in Scotsman Guide's Commercial Edition.
Despite the economic downturn and the fact that many aspects of the commercial real estate industry still need time to season before true recovery takes place, some niche segments of the market are actually performing extremely well. In fact, some are at the same level they reached at the height of the market.
Triple-net-lease investment properties, in particular, may be a true bright spot on the commercial investment horizon. Here's why.
Triple net lease properties are probably some of the most commonly noticed commercial real estate in the market. Most of the assets are drugstores, bank branches, restaurants, home-improvement centers and the like. These are core assets that have daily users and requirements. Typically, they are single-tenant buildings where, through the lease structure, the tenant is responsible for the taxes, insurance, and maintenance and management of the building - the three "nets."
Investors have a strong appetite for passive income in today's market, as there are few alternatives for them to receive a return that is equal to or better than what net lease assets provide. Additionally, it seems that lenders are becoming more comfortable with the asset type - many transactions in today's market are using some sort of lender-provided leverage.
Mortgage brokers are an integral part of the lending process for net lease investments, especially because one lender won't provide the best rate and terms for a particular investor every time. Brokers who want to increase their business in this asset class should understand what goes into funding triple net lease properties and be aware of the market's emerging trends.
Underwriting the tenant
Like in any underwriting process, lenders consider the real estate's value first. With net lease investments, however, the current tenant's credit also is weighed heavily.
Because tenants occupying single-tenant buildings typically sign long leases - sometimes for as many as 25 years or more - lenders want to know who is actually paying the rent to support the property for that long. Therefore, the underwriting of the tenant's credit becomes a key factor for lenders considering net leased assets.
There is some standardization for rating tenants, which comes primarily from credit-rating agencies such as Standard & Poor's (S&P), Moody's Investor Service, Fitch Ratings, etc. These agencies each have their own alphanumeric system to report how a particular company is performing from a credit perspective. S&P, for instance, has ratings that begin at AAA as the best-possible credit and incrementally go down to D.
In today's lending environment, net lease tenants with an S&P credit rating of BBB or greater have a better chance of getting a lender's attention because they are seen to be less risky. Tenants with credit ratings less than BBB are perceived to be more likely to default over the term of the lease.
In fact, a Moody's study quantified this phenomenon, stating that companies with a BBB- credit rating have a 4-percent chance of defaulting on their lease within any five-year period. Conversely, a company that has rating of B- has a 43-percent chance of defaulting on its lease within the same period. As a matter of comparison, companies with AAA ratings have a 0.15-percent chance of defaulting. It is pretty clear why lenders focus their underwriting on the potential tenant's credit.
Funding net leases
Although mortgage brokers unfamiliar with this asset class may think this type of debt comes from sophisticated sources housed in a class-A skyscraper on Wall Street, the vast majority of loans for net lease investments come from banks.
Real Capital Analytics, a market-research company, recently reported that 51 percent of single-tenant acquisition transactions completed to-date in 2010 came from a traditional bank. It also reported, however, that 40 percent came from a national bank and 11 percent was from a regional or local bank.
It seems that when a recession hits, the lending environment changes to a point that sophisticated financing instruments are no longer needed to drive the market. Instead, individual relationships between borrowers, lenders and their conduits (i.e., mortgage brokers) are the primary source of transaction volume.
In addition, Real Capital Analytics reported that 30 percent of the transactions completed this past year used existing financing that was assumed by a new buyer. Anecdotally, investors active in the market at the beginning of this year did not have as many sources of capital. Those who made purchases that required financing were given financing quotes that were outrageous and did not allow the transaction to make sense to the investor. Therefore, they assumed the debt from the previous owner because the terms and interest rates were more favorable than the market at that time. Sourcing debt for net lease investments is becoming easier, however.
Gaining market share
Single-tenant properties have become so popular this past year that they comprised roughly 35 percent of all commercial real estate transactions completed in the first two quarters of the year, according to data from Real Capital Analytics. By comparison, when the market was at its peak in 2007, only 20 percent of all transactions included the asset class.
With more than $425 billion in total commercial sales in 2007 - which included $85 billion in single-tenant sales - compared to $35 billion in total sales for these past first two quarters - which included $12.25 billion in single-tenant sales - it is apparent that with fewer transactions, more people are steering toward stabilized and lower-risk properties.
Capitalization rates - or cap rates - are a quick snapshot of an investor's return. In today's market, cap rates are roughly 6 percent to 8 percent for creditworthy properties. When a basic comparison is made using other passive investments, it is fairly clear why investors are seeking to put their capital to work in the property type.
Most investors who have cash available to make passive, nonspeculative investments are using basic money-market or savings accounts to hold the cash. When returns for those investment vehicles hover around 1 percent, the investor is motivated to find alternative investments for that capital while also maintaining a steady and safe cash flow over a period of time. Net lease properties are filling that void.
Tracking trends
There are different periods where lenders will have a strong appetite for a particular tenant and less so for other tenants, and this changes over time. Brokers who stay on top of these kinds of trends in their markets and leverage their relationships with lenders can help clients find the best rates and terms at any particular moment.
As an example, Walgreen Co. drugstores - a common triple net lease tenant - have an S&P credit rating of A+. As such, lenders are comfortable with these stores' credit and viability as a longstanding tenant. At the beginning of this year, however, there were more than 450 Walgreens stores available for purchase as net lease investments.
Because most investors need financing to purchase a single store and the average sale price for a Walgreens store is about $5 million, mortgage brokers were engaged to find the best debt. Lenders, however, found that they had too many Walgreens loans on their balance sheets and started to slow down the distribution of debt for that tenant. Brokers show their value in these scenarios by finding other lending sources that aren't as saturated with one particular tenant.
Supply and demand dictates the rate and terms of a particular tenanted-occupied building. Because of their popularity, Walgreens investments typically garner a higher interest rate. Other companies that have S&P credit ratings of A+ and similar lease terms, but higher price tags and therefore fewer buyers may have substantially lower interest rates.
Lenders, therefore, dictate rates and terms based not only on the tenant's credit, but also on subjective factors that move markets in different directions at different times. Mortgage brokers should be cognizant of these trends and have their arsenal of lending sources available for their clients as market indicators change.
Net lease properties have proven to be a strong asset class in this recovery -driven market. Lenders are seeking assets for their portfolios to maintain strong balance sheets. It's always better to have a stabilized net lease investment earning income for the lender and the investor on the books as opposed to vacant, speculative land that likely has an undetermined value for future development.
Mortgage brokers who focus on this asset class can take advantage of the new demand for these properties, as they are some of the only properties getting funded with rates and terms last seen at the height of the market.
www.calkain.com
By: David Sobelman, Executive Vice President, Calkain Cos.
As published in Scotsman Guide's Commercial Edition.
Despite the economic downturn and the fact that many aspects of the commercial real estate industry still need time to season before true recovery takes place, some niche segments of the market are actually performing extremely well. In fact, some are at the same level they reached at the height of the market.
Triple-net-lease investment properties, in particular, may be a true bright spot on the commercial investment horizon. Here's why.
Triple net lease properties are probably some of the most commonly noticed commercial real estate in the market. Most of the assets are drugstores, bank branches, restaurants, home-improvement centers and the like. These are core assets that have daily users and requirements. Typically, they are single-tenant buildings where, through the lease structure, the tenant is responsible for the taxes, insurance, and maintenance and management of the building - the three "nets."
Investors have a strong appetite for passive income in today's market, as there are few alternatives for them to receive a return that is equal to or better than what net lease assets provide. Additionally, it seems that lenders are becoming more comfortable with the asset type - many transactions in today's market are using some sort of lender-provided leverage.
Mortgage brokers are an integral part of the lending process for net lease investments, especially because one lender won't provide the best rate and terms for a particular investor every time. Brokers who want to increase their business in this asset class should understand what goes into funding triple net lease properties and be aware of the market's emerging trends.
Underwriting the tenant
Like in any underwriting process, lenders consider the real estate's value first. With net lease investments, however, the current tenant's credit also is weighed heavily.
Because tenants occupying single-tenant buildings typically sign long leases - sometimes for as many as 25 years or more - lenders want to know who is actually paying the rent to support the property for that long. Therefore, the underwriting of the tenant's credit becomes a key factor for lenders considering net leased assets.
There is some standardization for rating tenants, which comes primarily from credit-rating agencies such as Standard & Poor's (S&P), Moody's Investor Service, Fitch Ratings, etc. These agencies each have their own alphanumeric system to report how a particular company is performing from a credit perspective. S&P, for instance, has ratings that begin at AAA as the best-possible credit and incrementally go down to D.
In today's lending environment, net lease tenants with an S&P credit rating of BBB or greater have a better chance of getting a lender's attention because they are seen to be less risky. Tenants with credit ratings less than BBB are perceived to be more likely to default over the term of the lease.
In fact, a Moody's study quantified this phenomenon, stating that companies with a BBB- credit rating have a 4-percent chance of defaulting on their lease within any five-year period. Conversely, a company that has rating of B- has a 43-percent chance of defaulting on its lease within the same period. As a matter of comparison, companies with AAA ratings have a 0.15-percent chance of defaulting. It is pretty clear why lenders focus their underwriting on the potential tenant's credit.
Funding net leases
Although mortgage brokers unfamiliar with this asset class may think this type of debt comes from sophisticated sources housed in a class-A skyscraper on Wall Street, the vast majority of loans for net lease investments come from banks.
Real Capital Analytics, a market-research company, recently reported that 51 percent of single-tenant acquisition transactions completed to-date in 2010 came from a traditional bank. It also reported, however, that 40 percent came from a national bank and 11 percent was from a regional or local bank.
It seems that when a recession hits, the lending environment changes to a point that sophisticated financing instruments are no longer needed to drive the market. Instead, individual relationships between borrowers, lenders and their conduits (i.e., mortgage brokers) are the primary source of transaction volume.
In addition, Real Capital Analytics reported that 30 percent of the transactions completed this past year used existing financing that was assumed by a new buyer. Anecdotally, investors active in the market at the beginning of this year did not have as many sources of capital. Those who made purchases that required financing were given financing quotes that were outrageous and did not allow the transaction to make sense to the investor. Therefore, they assumed the debt from the previous owner because the terms and interest rates were more favorable than the market at that time. Sourcing debt for net lease investments is becoming easier, however.
Gaining market share
Single-tenant properties have become so popular this past year that they comprised roughly 35 percent of all commercial real estate transactions completed in the first two quarters of the year, according to data from Real Capital Analytics. By comparison, when the market was at its peak in 2007, only 20 percent of all transactions included the asset class.
With more than $425 billion in total commercial sales in 2007 - which included $85 billion in single-tenant sales - compared to $35 billion in total sales for these past first two quarters - which included $12.25 billion in single-tenant sales - it is apparent that with fewer transactions, more people are steering toward stabilized and lower-risk properties.
Capitalization rates - or cap rates - are a quick snapshot of an investor's return. In today's market, cap rates are roughly 6 percent to 8 percent for creditworthy properties. When a basic comparison is made using other passive investments, it is fairly clear why investors are seeking to put their capital to work in the property type.
Most investors who have cash available to make passive, nonspeculative investments are using basic money-market or savings accounts to hold the cash. When returns for those investment vehicles hover around 1 percent, the investor is motivated to find alternative investments for that capital while also maintaining a steady and safe cash flow over a period of time. Net lease properties are filling that void.
Tracking trends
There are different periods where lenders will have a strong appetite for a particular tenant and less so for other tenants, and this changes over time. Brokers who stay on top of these kinds of trends in their markets and leverage their relationships with lenders can help clients find the best rates and terms at any particular moment.
As an example, Walgreen Co. drugstores - a common triple net lease tenant - have an S&P credit rating of A+. As such, lenders are comfortable with these stores' credit and viability as a longstanding tenant. At the beginning of this year, however, there were more than 450 Walgreens stores available for purchase as net lease investments.
Because most investors need financing to purchase a single store and the average sale price for a Walgreens store is about $5 million, mortgage brokers were engaged to find the best debt. Lenders, however, found that they had too many Walgreens loans on their balance sheets and started to slow down the distribution of debt for that tenant. Brokers show their value in these scenarios by finding other lending sources that aren't as saturated with one particular tenant.
Supply and demand dictates the rate and terms of a particular tenanted-occupied building. Because of their popularity, Walgreens investments typically garner a higher interest rate. Other companies that have S&P credit ratings of A+ and similar lease terms, but higher price tags and therefore fewer buyers may have substantially lower interest rates.
Lenders, therefore, dictate rates and terms based not only on the tenant's credit, but also on subjective factors that move markets in different directions at different times. Mortgage brokers should be cognizant of these trends and have their arsenal of lending sources available for their clients as market indicators change.
Net lease properties have proven to be a strong asset class in this recovery -driven market. Lenders are seeking assets for their portfolios to maintain strong balance sheets. It's always better to have a stabilized net lease investment earning income for the lender and the investor on the books as opposed to vacant, speculative land that likely has an undetermined value for future development.
Mortgage brokers who focus on this asset class can take advantage of the new demand for these properties, as they are some of the only properties getting funded with rates and terms last seen at the height of the market.
www.calkain.com
Friday, January 21, 2011
Pep Boys Said to Explore Possible Sale
Pep Boys - Manny, Moe & Jack, the Philadelphia-based auto-parts retailer, is considering a sale of the company and working with Bank of America Corp. to explore strategic options, said two people with knowledge of the matter. The shares rose the most in almost 10 years.
Pep Boys isn’t likely to run a formal sales process, and is trying to drum up interest among a handful of private-equity firms such as Leonard Green & Partners LP, Bain Capital LLC and TPG Capital, said one of the people, who declined to be identified because the process is private. Pep Boys tried unsuccessfully to sell itself in the past, the people said.
The company has renewed efforts to find a buyer as its earnings improve and private-equity firms seek takeover targets in retail, the people said. Founded 90 years ago, Pep Boys has more than 600 stores across the U.S. offering service and parts. It earned $23 million in the year ended Jan. 30 after four straight years of losses. In December, Pep Boys said profit for the first nine months of the year climbed 36 percent, bolstered by new tire centers and increasing customer traffic.
Pep Boy leases are absolute net leases, while Advance Auto generally signs a net lease that provides for the Landlord to be responsible for the maintenance of the roof and structure of the building. Generally speaking, Pep Boys utilizes a larger building footprint with six to eight service bays attached to the retail storefront. This is important for two reasons: 1) with a cost segregation study, Landlords are able to capture significant amount of accelerated depreciation and 2) Landlords have relatively large buildings and land parcels (17,000-22,000 sf buildings on a 2+ acre lots), which offer advantageous options for re-use and/or redevelopment.
The Pep Boys — Manny, Moe & Jack (NYSE: PBY), is an automotive service and retail chain. The Company is engaged in automotive repair and maintenance, and the sale of automotive tires, parts and accessories. Competitors include Advanced Auto Parts and AutoZone.
Net Lease Market
Pep Boys isn’t likely to run a formal sales process, and is trying to drum up interest among a handful of private-equity firms such as Leonard Green & Partners LP, Bain Capital LLC and TPG Capital, said one of the people, who declined to be identified because the process is private. Pep Boys tried unsuccessfully to sell itself in the past, the people said.
The company has renewed efforts to find a buyer as its earnings improve and private-equity firms seek takeover targets in retail, the people said. Founded 90 years ago, Pep Boys has more than 600 stores across the U.S. offering service and parts. It earned $23 million in the year ended Jan. 30 after four straight years of losses. In December, Pep Boys said profit for the first nine months of the year climbed 36 percent, bolstered by new tire centers and increasing customer traffic.
Pep Boy leases are absolute net leases, while Advance Auto generally signs a net lease that provides for the Landlord to be responsible for the maintenance of the roof and structure of the building. Generally speaking, Pep Boys utilizes a larger building footprint with six to eight service bays attached to the retail storefront. This is important for two reasons: 1) with a cost segregation study, Landlords are able to capture significant amount of accelerated depreciation and 2) Landlords have relatively large buildings and land parcels (17,000-22,000 sf buildings on a 2+ acre lots), which offer advantageous options for re-use and/or redevelopment.
The Pep Boys — Manny, Moe & Jack (NYSE: PBY), is an automotive service and retail chain. The Company is engaged in automotive repair and maintenance, and the sale of automotive tires, parts and accessories. Competitors include Advanced Auto Parts and AutoZone.
Net Lease Market
Brooklyn Showed Some Improvement in 2010
Commercial property sales in Brooklyn showed little improvement in 2010 even as the volume of sales surged in Manhattan.
There were 778 commercial real-estate transactions in Brooklyn in 2010, down from 805 in 2009, according to a new report by commercial-brokerage firm Terra CRG LLC.
TerraCRG: Commercial Real Estate Stabilizing
Terra CRG just released its 2010 report on the state of the commercial real estate market in Brooklyn. According to the report, the billion dollars or so in sales is about in line with 2009 number. While you can check out data on retail and multi-family sales here, we were particularly interested in the levels at which developable property was changing hands. Despite cries of oversupply and a handful of high-profile projects going belly up, developers apparently have not lost their appetite for North Brooklyn. Williamsburg had the highest number of sales (8) and the highest dollar volume ($20,597,593). As the chart above shows, Williamsburg and Greenpoint also put up the highest numbers on a price-per-buildable-square-foot basis. Interesting.
There were 778 commercial real-estate transactions in Brooklyn in 2010, down from 805 in 2009, according to a new report by commercial-brokerage firm Terra CRG LLC.
TerraCRG: Commercial Real Estate Stabilizing
Terra CRG just released its 2010 report on the state of the commercial real estate market in Brooklyn. According to the report, the billion dollars or so in sales is about in line with 2009 number. While you can check out data on retail and multi-family sales here, we were particularly interested in the levels at which developable property was changing hands. Despite cries of oversupply and a handful of high-profile projects going belly up, developers apparently have not lost their appetite for North Brooklyn. Williamsburg had the highest number of sales (8) and the highest dollar volume ($20,597,593). As the chart above shows, Williamsburg and Greenpoint also put up the highest numbers on a price-per-buildable-square-foot basis. Interesting.
Subscribe to:
Posts (Atom)