All Forum Posts by: Edward Alicante

Hello everyone! BPCON 2022 is officially sold out, but we know plan can change. If you have a ticket, please post it in this thread. When it is sold, please quote your original post and say "SOLD" in caps in the response. This will help keep track of who has tickets and who is still looking. If we are able to open any additional ticket, they will be posted here as well, but we are not expecting to have any more availability on our side. Looking forward to a great event!

Starbucks not 20 year lease. Most 10 years. Very few absolute NNN these days. Most are NN with roof warranty. Lately Starbucks has tried to write in parking lot and a bunch of other items that they reimburse for. Problem with that is people buy NNN to be HANDS OFF. They are willing to accept lower returns to do that. When they have to do all of this crap per the lease even if tenant pays for it then they are taking on management.

People that have millions to tens of millions of dollars value THEIR TIME. They do not want to be bothered with such things. If they did they would buy active real estate assets that produce more yield for the work involved. So as a property owner you have to fight back against those requests from a tenant or fill up the space with a different tenant that is not going to demand that to do a lease.

Certain price ranges say 4 million and up less cash buyer than 3 million and below. There are a ton of factors that go into buying NNN properties and one is a persons financials and what their goals are today and long term. Owning NNN is simple. Evaluating it and buying the right property is more complex than people think.

The valuation is based on several factors:

Location, Brand, Length of Lease, marketplace, income, and financial rating of tenant. Usually Starbucks checks all of these boxes. 

Let’s say you bought a Starbucks at a 4% cap for 2million with no expenses or responsibilities. In 5 years your income increases to 88k a year or a 4.4 cap if you were to sell it for 2mill to break even.  however 5 years from now the marketplace can dictate a 5 cap (thus losing money) or maybe you can sell at 4 cap or lower making money.  5 years from now the market will dictate it’s worth and not necessarily the income that it produces

ps  I happen to own a Starbucks in my portfolio, but it’s a double net