Where to invest is a question on many people’s minds today. Manyare seeking to mitigate risk and avoid the costly mistakes of thepast while still owning a lucrative investment. As such, a growingdebate has emerged about where best to place capital. Although somewould dismiss real estate as too costly; closer inspection revealsa well of opportunity.
Let’s say you were looking to invest in either CVS bonds or realestate earlier this year (CVS rated BBB+ by Moody’s). A 10yrissuance that was done in March of 2009 has maturity date of 2019.It pays a coupon of 6.6% and is priced at $111.45; you wouldreceive a yield to maturity of 5.04%, and an annual yield of5.92%.
Now let’s look at an opportunity to purchase a brick and mortarstore that CVS would lease from you. The lease runs through 2034,and property is for sale at $3.5Mil. Furthermore, there are.50/Sqft increases in rent every five years.
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Jonathan Hipp
Jonathan Hipp began his career in real estate over 25 years ago. In his early years as a broker, he ventured into the net lease industry and quickly began leading the US net lease market, closing over $3 billion in transactions. In 2005, Jon founded Calkain Companies, a company focused solely on net lease investment services. As President and CEO, he has been instrumental in building the firm into one of the leading Net Lease real estate companies, transacting over $12 billion of net lease deal volume over the past 13 years. He has expanded Calkain’s services to include brokerage, advisory, asset management, capital markets, and industry research. He has become a well-known resource, panelist, and speaker at various Net Lease and Industry conferences and is a regular contributor to GlobeSt.com on real estate trends. In June 2015, Jon’s passion for the real estate business was again recognized as he was nominated for the Top Real Estate Player in the DC area by SmartCEO magazine.
