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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.
January 14, 2019
If investors are anything like the average net lease property owner, they might find a retail pharmacy is a solid investment. Even better news is this investment will likely to continue providing a reasonable rate of return.
December 26, 2018
Net lease investors should care if a potential tenant has put in the time and effort to develop an app.
December 14, 2018
Certainly, there are risks when it comes to owning a net lease medical property and due diligence is essential but the future is bright for the sector.
November 06, 2018
Giant retailers are experiencing huge success with shrinking real estate footprints. Net-lease investors can benefit from owning smaller-format stores.
October 16, 2018
As robust as the overall CRE lending picture might be on the surface, banks are being more cautious.
October 02, 2018
QSRs have continued to sell at a lower cap rates than the single tenant net lease average.
September 12, 2018
If you’re an investor that either owns or is considering buying a stand-alone Rite Aid retail pharmacy, the scenario and forecast are somewhat mixed.
September 04, 2018
In 10 years, we can expect to again be at a strong point in the CRE cycle, and we’ll definitely have witnessed some fundamental changes.
August 15, 2018
Early indications show that 2018 is holding true to form, except in net lease. The slower than normal pace this year for the wider commercial real estate industry is more likely due more to cycle than season.
July 30, 2018
Cap rates overall have seen an up-tick, but at a manageable pace, while core assets continue to trade at historically aggressive pricing
June 28, 2018
While the grocery industry is undergoing changes in tenant mix, technology, and customer trends, the acquisition of Whole Foods by Amazon did not have a noticeable effect on grocery sector.
June 21, 2018
The proposed merger has been met with mixed reactions. Find out what it means to net lease investors.
May 04, 2018
With the risk-free rate moving up, investors will expect returns on their investments to trend in the same direction.
April 13, 2018
Real estate investors interested in owning stand-alone quick-service restaurants should focus on lease terms, location and tenant credit-worthiness. Investors should also understand trends driving fast-food success.
March 29, 2018
There are many different strategies for investing in real estate and many buzz words thrown around such as generational, trophy, value add or core. As…
March 15, 2018
Just as the dust settled on the Walgreens Boots Alliance-Rite Aid Corp. alliance, the latter made news once again. In late February 2018, supermarket…
February 06, 2018
Even as the role of retail pharmacy stores is changing, the physical buildings and land continue to be worthwhile investments, with a steady rate of return.
January 30, 2018
When Amazon announced they were looking to create a second headquarters, cities from all over North America scrabbled to put together an incentive…
January 12, 2018
Walgreens’ final $4.4-billion offer to buy Rite Aid, and CVS Health’s $69-billion agreement to acquire Aetna were the major stories involving net…
December 12, 2017
Google the term “buying a triple net asset,” and you’ll see plenty of how-to articles on the topic. However, that information seems to be…
November 28, 2017
On Nov. 16, the House of Representatives passed HR-1 the “Tax Cuts and Jobs Act.” Now the legislation moves on to the Senate for its debate, markup…
November 13, 2017
For many investors, net leased assets are proving to be steady, low-risk alternative investments for their portfolios. Read on to learn why.
October 24, 2017
Starbucks has seen large amounts of growth over the past few years. With numbers taken from Starbucks Annual Reports from 2012 through 2016, we have…
September 19, 2017
In 1972, an extension of Medicare was passed to cover the cost associated with dialysis treatments for any US citizen who was suffering from End Stage…
September 05, 2017
On August 28, Amazon officially acquired Whole Foods. There have been some immediate customer facing changes such as slashing prices on a selection…
August 14, 2017
Walgreens had entered into an agreement to acquire Rite aid in October 2015. The agreement was stalled while both companies waited for approval from…
August 02, 2017
On July 26th, the Federal Reserve System (the Fed) announced they will maintain the current target range for the federal funds rate, 1.00% – 1.25%.…
June 28, 2017
Consumer Confidence has been surging, hitting 117.9 on their index in May of 2017, and the National Federation of Independent Business’ (NFIB) Small…
May 11, 2017
The first quarter of 2017 can be summed up with a single word: Stable. According to our Calkain research team, the entire market only moved 11 bps.…
March 07, 2017
Which new fast-casual chain will be the next Chipotle? This a question many investors and landlords wonder and ask. Competition is fierce…
February 21, 2017
The 1950s saw the birth of the shopping mall across the nation, yet the era of destination retail stores, especially clothing stores, has been on a…
January 20, 2017
The recent announcement that Fred’s would purchase upwards of 600 locations from Walgreens/Rite Aid to help ensure approval of their merger, highlights…
December 19, 2016
Starbucks is one of the world’s most recognizable brands and has continued to stay ahead of its competitors. Recently, the company announced a major…
December 09, 2016
In the aftermath of the country’s most historic and polarizing election, the Trump administration plans to make changes to tax policy including:…
November 30, 2016
With the holiday season in full swing, the country will be waiting to see if the Fed will increase interest rates during their meeting on December…
November 09, 2016
Fresenius and DaVita are the top two dialysis providers in the nation. Demand for these centers has increased dramatically in recent years due to the…
October 24, 2016
There are many forces driving Dollar General to be an investor’s current pick in the net lease world. As of August 13, 2016, Dollar General operates…
October 05, 2016
Auto parts stores don’t usually make the top of the list when investors are looking for “flashy” retail opportunities. But as far as net-lease…
September 21, 2016
Walmart’s plan to open a new distribution center is now moving forward in the city of Cocoa. This will be Walmart’s second distribution center…
August 31, 2016
REITs have attracted investors looking for a higher yield than can be found in the bond market. Previously, REITs have been included inside the financial…
August 15, 2016
CVS and Walgreens are in a constant battle for the biggest share of the market. CVS acquired Omnicare and Target’s pharmacies last year and Walgreens…
August 01, 2016
Dollar stores were once looked upon as second-class citizens in the retail world. Well, that is far from the case nowadays.
June 29, 2016
Jonathan HippThere are a few ways to consider the difference between triple-net (NNN) and double-net (NN) leases, and why a tenant might choose one…
June 10, 2016
In an ongoing Calkain series, we are looking at the leaders in particular net-lease sectors and comparing some important information about how they…
May 18, 2016
Both Burger King and McDonald's are on an upswing. Does one stand tall over the other?
April 28, 2016
Drugstores have always been a big part of retail real estate’s net lease sector. After all, Walgreens and CVS have thousands of stores across the…
April 01, 2016
Since the onset of the great recession the specter of inflation has always seemed right around the corner; only to be ultimately pushed off further…
March 10, 2016
There has been a lot of speculation about what the remainder of the year will bring for commercial mortgage-backed securities (CMBS), and much of that…
February 24, 2016
Walmart has made several headlines already this year, and not all of them have been great news for retail real estate landlords.
February 12, 2016
At the end of 2015, President Obama signed into law the Protecting Americans from Tax Hikes (PATH) Act which offers some tax protection benefits of…
January 15, 2016
As new construction remains modest, a key question in the net lease market is where future deal flow will come from.
January 05, 2016
Cap rates in the net lease sector are at all-time lows. That statement (of the obvious) in and of itself is not a headline. The change in the mix of properties making up what is being sold today versus the last few years is, however, worth looking at. The properties that have been driving the ever lower cap rates are ironically the ones with less credit behind them. Indeed for each year over the past…
December 11, 2015
Like much of the net-lease market, Dollar General cap rates have been compressing since 2009. However, as we approach the end of 2015, it is increasingly likely average cap rates for Dollar General stores will set an all time new record.
November 06, 2015
Last week's announcement of Walgreens $17B+ acquisition of Rite Aid has sent reverberations throughout the single-tenant net-lease world. The merger would combine the country's largest and third largest pharmacies, creating a retail behemoth with well over $100B+ in annual sales.
October 29, 2015
Founded in 1971, Starbucks is a global brand in the quick service retail sector, specializing in the sale of high-margin specialty coffee. For the fiscal year ending 2014, Starbucks generated revenue of $16.44 billion and net income of $2.07 billion, with an extremely impressive gross margin of 58.54% and pre-tax operating margin of 18.7%. As of September 2015, its stock had appreciated 48% on a year-over-year basis. …
September 18, 2015
Below is a chart that shows the average cap rates of over 7,000 single tenants net-lease (STNL) sales captured over the last nine years. The red line represents the moving average of the last 200 sales at any given point in time.
August 28, 2015
One metric that Calkain uses to partially measure supply in the market is the change in average lease years remaining at the time of sale on a quarter-by-quarter basis. An increase means the mix of properties being sold is newer, which could be caused by several things, however in our experience it's primarily due to new construction. …
August 14, 2015
When it comes to net lease properties, buyers and sellers often focus on investment aspects such as tenant creditworthiness, lease years remaining, and rent escalations. To be sure, these aspects are critical in the net lease arena. However, it is essential to recognize that, at the end of the day, real estate is about location, and a good location can overcome many weaknesses in fundamentals. …
August 03, 2015
Within the single-tenant net lease space, I often get asked whether I believe there is a bubble in commercial real estate due to cap rates being below 2006 levels. The honest answer is I don't know, and neither do most people. Bubbles are generally discovered only after they pop.
July 10, 2015
One of the largest sectors in the net-lease space is quick service restaurants (QSRs), consisting of stand-alone locations flagged with tenants such as Wendy's, KFC/Taco Bell, and Burger King.
June 05, 2015
Walmart, the retail behemoth with a market cap of $238 billion, is mixing things up. For decades, the company's standard policy of building big-box stores aimed at price conscious working-class customers was resoundingly successful. However, it is increasingly clear simply adding large stores won't be enough to increase, or even maintain, its level of profitability. …
May 29, 2015
For almost every product out there, a discount is available for buying in bulk. The same is true for real estate, including single-tenant net lease properties.
May 22, 2015
The annual pilgrimage for brokers, developers, and tenants to Las Vegas took place this past week. The 2015 ICSC RECON event brought together 34,000 attendees and 1,000 exhibitors to discuss industry trends and make deals.
May 15, 2015
Many business owners reach a point where they need additional capital to fuel growth. Traditional means of doing this include raising equity or taking on more debt. One of the more under utilized options for businesses that own their own real estate however is the sale-leaseback.
May 08, 2015
Following a pattern we're seeing in the wider market, Wendy's this week announced that they were going to sell as many as 640 stores to their franchisees. This on the heels of McDonald's announcing they would do the same for 3,500 stores as part of their effort to boost the bottom-line. …
May 01, 2015
McDonald's (MCD), a long time behemoth in the net lease sector, has found itself under significant pressure lately.
April 24, 2015
First Choice Emergency, listed as Adeptus Health, Inc. (NYSE: ADPT), is an emergency room services provider that operates 55 ER clinics across the United States*. The company operates stand-alone centers with board certified physicians that can provide most services offered by conventional hospital ERs. Adeptus Health is backed by growth private equity firm Sterling Partners. …
April 17, 2015
It is no secret cap rates for net lease properties, and investment real estate in general, have compressed dramatically in the last few years. This trend is especially pronounced for properties with investment grade tenants and long lease terms which are trading at all time low cap rates.
April 09, 2015
By all accounts, 2014 was a breakthrough year for Rite Aid (NYSE: RAD), and by extension, owners of Rite Aid net leased pharmacies. After struggling for over a decade with structural weaknesses in its business, ranging from accounting scandals to poor acquisitions, the company is finally managing to turn around its operations. All the while making some landlords very, very happy. …
April 02, 2015
The Kroger Co. (NYSE: KR) operates over 3,000 supermarkets and convenience stores in the United States. For the period ending January 31st, 2015, it generated revenues of $108.47 billion and net income of $1.728 billion. Kroger has an investment grade rating (BBB) from Standard and Poor's.
March 26, 2015
Jack in the Box (NASDAQ: JACK) operates and franchises Jack in the Box and Qdoba Mexican Grill restaurants in twenty-one (21) U.S. states. The company's 2,888 stores are concentrated in California, where it was founded, Texas, and the Southwest.
March 20, 2015
Subdivision is the process of taking a property, usually land, and splitting it into multiple parts for resale or development.
March 13, 2015
Single tenant triple net leased properties (NNN) trade at a premium relative to similar properties with so called double-net (NN) leases. NN leases typically require the landlord to retain some responsibility for the roof, structure or some other aspect of the property. Being the most passive real estate investment available, however, NNN properties require virtually no involvement of the landlord. This increases the demand by expanding the universe of potential buyers to include many Buyers…
March 09, 2015
On February 6, 2015, RadioShack filed for bankruptcy. The 94-year old retailer, unable to adapt to changing consumer tastes and compete with more efficient e-commerce competitors like Newegg, had posted negative earnings for 11 straight quarters. For those in the real estate business, the immediate question became what kind of impact the bankruptcy would have on properties with RadioShack as a tenant. The answer may very well be not much. …
February 11, 2015
The market has reacted favorably to Rite Aide's purchase of EnvisionRX for $2 Billion in cash and stock.
February 04, 2015
2014 ended with a flurry of activity as people rushed to close deals by year end.
January 28, 2015
Chipotle is a highly sought after brand. There is great demand for their freestanding stores as net lease investments.
January 21, 2015
The poster-child of net lease properties, Walgreens has been a highly traded investment property given the low risks typically associated with these drugstore properties. Additionally, the drugstore sector remains stable given is non-discretionary merchandise offerings.
January 14, 2015
Although Chick-fil-A is a private company, there is great demand for their free-standing stores as net lease investments. The properties are well located near major shopping centers, university and college campuses, and business centers.
December 19, 2014
Universal feedback the new location was a 100% improvement and ICSC may already be reserving more space for next year.
December 10, 2014
Over the past few years dollar store properties have become one of the more attractive net lease investments for investors.
December 03, 2014
From a real estate perspective, Chase utilizes 7 different prototypes, depending on location and available site dimensions, with the bank branches ranging from 2,585sf to 4,766 situated on 0.65 to just over 1 acre of land.
November 20, 2014
Cap rates for net lease banks and Bank of America specifically are at their lowest point in eight years.
November 12, 2014
What is an outparcel? An outparcel refers to a smaller asset that is carved out from a larger asset. Frequently property owners do not realize the value they can unlock by marketing and selling these types of assets.
November 05, 2014
Mattress Firm is a highly sought after brand that has been aggressively expanding in recent years.
October 30, 2014
As we progress into the 4th quarter cap rates are compressing throughout many net lease sectors.
October 22, 2014
Investors like DaVita's small price point and the fact that kidney dialysis is a growth industry.
October 15, 2014
Credit Ratings play a large role in the net lease world.
October 09, 2014
Ashley Furniture HomeStore is a highly sought after brand and has been aggressively expanding in recent years.
October 01, 2014
There is great demand for their free-standing Dairy Queen stores as net lease investments.
September 24, 2014
Overall retail cap rates ticked up a bit in September but remain sub-seven at 6.94%.
September 17, 2014
Although Bojangles' is a private company, there is great demand for their free-standing stores as net lease investments.
September 11, 2014
Restaurants continue to be a highly desired asset among net lease investors.
September 03, 2014
Florida's retail real estate sector continues to see growth as over 3500 retailers gathered in Kissimmee this year for the 2014 ICSC Florida Conference.
August 27, 2014
Overall cap rates dropped in August to an average of 6.58%.
August 21, 2014
Investors like DaVita's small price point and the fact that kidney dialysis is a growth industry.
August 15, 2014
This investment grade auto parts retailer remains strong, with a stable credit-rating outlook and a growing market share.
July 30, 2014
Over the past few years Dollar Store properties have become some of the most attractive Net Lease Investments available for buyers and investors.
From EBI Consulting
Due diligence can be a daunting requirement to navigate in CRE transactions. Learn about the different Property Condition Assessment types, including those tailored to support acquisitions.
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