CHICAGO—Few single-tenant net leased properties are more attractive to buyers than investment-grade auto parts stores. JLL’s capital markets team, for example, on behalf of a Chicago-based private investor, just completed the sale of an AutoZone store in suburban Aurora to a private investor in a 1031 exchange based in Boise, ID for about $1 million.
The property totals 5,500-square-feet and has a long-term ground lease with multiple renewal options. It sits about one half mile south of I-88 at 1283 N. Lake St. in Aurora, Illinois’ second-largest city. The grocery anchored shopping center, Aurora Commons, is located directly to the west of the property.
JLL vice president Matt Berres led the team on this transaction.
In the past 12 months, JLL has closed more than $500 million of single-tenant, net leased properties across the country, making the firm the nation’s leading seller of such properties, company officials say. In addition, JLL has nearly $750 million in single-tenant net lease offerings currently in the market.
As reported in GlobeSt.com, a report published earlier this month by the Boulder Group found that cap rates in the auto parts store sector compressed from the fourth quarter of 2012 to the fourth quarter of 2013 by 31 bps. A limited supply of investment grade assets has helped push the rates down.
And AutoZone saw its cap rates compress 50 bps, down to 6.0%. Investors typically show more interest in AutoZone locations because tenants usually have 20-year leases, Boulder found.