High Demand for STNL Properties Across the Front Range

8350 W 80th Avenue Arvada CO, courtesy of CBRE.

DENVERCBRE  recently completed the sale of four single-tenant, net-leased (STNL) properties — all located within metro Denver — pointing to a larger trend of investor interest in STNL properties for their low-risk, low-maintenance profile.

Brad Lyons, Matthew Henrichs and Parker Brown with CBRE Capital Markets’ National Retail Partners in Denver represented each of the sellers and said transaction volume of STNL properties has picked up in velocity the first half of this year.

“Investors are pursuing single-tenant, net-leased retail properties because they typically feature long-term leases and offer true passive income with little to no maintenance or management oversight. These properties are generally low-risk and low-maintenance and offer investors a secure yield and a diversified income for their personal capital portfolio,” said Matthew Henrichs, Senior Vice President, CBRE.

The four STNL properties most recently transacted by CBRE include:

  1. A 5,400-square-foot, new construction Verizon store located at 7321 Sheridan Boulevard in Westminster, which sold for $2.35 million the last week of June.
  2.  A 4,995-square-foot Buffalo Wild Wings restaurant located at 8350 West 80th Avenue in Arvada. The building, which has been home to Buffalo Wild Wings for over 20 years, was sold for $1.422 million, also during the last week of June.
  3. A 6,975-square-foot, new construction Advance Auto Parts store located at 6701 South Potomac Street in Centennial, which also sold the last week of June, for $2.67 million.
  4. A 5,803-square-foot Mattress Firm/Vitality Bowls located at 830 New Memphis Court in Castle Rock. Although a two-tenant building, Mattress Firm represented approximately 70 percent of the rent roll, making it similar to a STNL from an investment perspective. The property sold for $3.55 million on July 23. All four properties were purchased by separate private investors from either California or Denver as part of 1031 exchanges.

The four most recent sales come on the heels of four previous STNL deals completed by Lyons, Henrichs and Brown earlier this year. In February, they completed the sales of another Verizon store in Castle Rock and a national coffee chain location in Centennial. In March, they represented the buyer in the purchase of a Marco’s Pizza location in Colorado Springs, and in April, they arranged the sale of a Carl’s Jr. in Loveland.

“We are seeing consistent demand for single-tenant, net-leased retail properties all across the Front Range. Investors locally and nationally want to be active here, and they have continued to pay a scarcity premium for best-in-class STNL properties,” said Parker Brown, associate, CBRE.

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