Net lease broker sells 7-Eleven portfolio

Net lease commercial real estate brokerage specialist B+E has negotiated the sale of 17 separate 7-Eleven stores to a newly formed real estate investment trust for $71.5 million.

The New York and Tampa brokerage firm sold the portfolio of convenience store portfolio on behalf of Monfort Cos., a Denver, Colo.-based company that is among one of 7-Eleven’s top franchisees nationwide.

Buyer NetStreit, which is striving to “create the highest quality net lease retail portfolio in the country in order to generate consistent cash flows and dividends for its investors, was represented in the transaction by Designated Broker Solutions broker Jon Nesbitt.

As part of the deal for the 17 stores in Western U.S. states, 7-Eleven signed new leases for each store with a term of 15 years.

In addition to 7-Eleven, Dallas-based NetStreit’s portfolio also includes Starbucks Coffee Co. shops, Home Depot Inc. stores and stand-alone CVS Pharmacies, according to its website.

“Every investor in the net lease space, from institutions to small, private firms and family offices, wants to have a 7-Eleven in their portfolio right now,” says Camille Renshaw, CEO of B+E.

“They’re an investment-grade, ‘A’ tenant that provides an essential service and they have really thrived during the COVID-19 pandemic,” Renshaw adds. “And that’s because they are considered to be such a low-risk investment. If anything, we’ve actually seen (capitalization) rates compress for properties such as these since the pandemic began.”

“Everyone knows 7-Eleven, they have a great story and they’re a very well-run company,” Renshaw says. “In this case, the credit worthiness of the tenant combined with the property type and location and the new 15-year lease commitment really drove this transaction.”

In net lease deals, which are also known as triple net or NNN transactions, tenants both pay rent and cover expenses typically handled by landlords — such as taxes, insurance, utilities or janitorial services.

The 7-Eleven sale marks the second large portfolio deal B+E has participated in since its formation in late 2017.

In the past year, the brokerage with six offices and 40 employees executed online property sales totaling $750 million, including the sale and leaseback of 11 Cabela outdoor stores containing 1.6 million square feet and 277 acres of land.