A Comprehensive Guide to Buying Pep Boys Real Estate for Sale
If you’re thinking about investing in triple net lease (NNN) properties, make sure you’re buying from a reliable company. Ensure, you patronize the one not just thriving in a specific region, but also generating good returns in investment. So, when the time comes for you to take over as owner, you won’t have to put in as much work to market your firm and attract clients because it already has a clientele to serve.
Pep Boys real estate for sale is currently one of the most profitable NNN investments on the market. Owning one of their stores allows you to participate in a thriving automotive market while also providing you with good long-term earnings.
That takes us to the main highlight of this guide. Below, we’ll be having a look at the essential things to keep in mind while buying Pep Boys real estate for sale and all other relevant things you need to know about Pep Boys.
Things to Know About Pep Boys
Pep Boys is a multinational automotive aftermarket service organization known for selling brand-name auto components and offering professional car maintenance and repairs to individuals and fleet owners.
Over time, the company has been based in over 9,000 locations in the United States and Puerto Rico, and it has continued to expand through acquisitions of other auto service companies, such as Just Brakes.
The company has leased a number of its retail stores to investors that are passionate about the automotive sector and addressing the rising needs of automobile owners in their various areas over the years.
If you intend on searching for a reliable source of passive income, investing in net leased Pep Boys stores is one of the best options to consider.
Benefits of Buying Pep Boys Real Estate for Sale
Purchasing and owning any of the NNN Pep Boys Auto Stores comes with all of the standard perks of buying and owning NNN properties. For instance, it delivers consistent passive income while requiring no effort on your side as the owner.
You are also free of the obligation of paying for the building’s maintenance and repairs, as well as taxes because the expenditures of owning and operating the property fall directly on the renter. Not only that, but unlike other rental investments, a NNN investment will secure long-term occupancy, ensuring a consistent stream of income for many years.
Investing in a NNN Lease Pep Boys property has its own set of perks in addition to these benefits. Besides the fact that the company has excellent credit, the lease arrangement would also ensure annual rental price increases. Their properties are also in prime locations, so strong sales are expected in the future. You will also have the option of repurposing or redeveloping the structure as you see fit.
Pep Boys NNN Lease Price and Terms
The price of Pep Boys real estate for sale is determined by several factors, including the location and size of the property. However, for structures ranging in size from 13,500 to 22,500 square feet, the median price ranges from $900,000 to $5,000,000.
When it comes to leasing terms, the company often offers 15-year net leasing absolute terms with 1.5 percent annual rental increases or 8 percent rental increases every five years. In addition to that, their homes typically have a cap rate of 6.25 percent to 6.75 percent.
Factors to Consider When Buying Pep Boys Real Estate for Sale
While purchasing Pep Boys real estate for sale relieves you of the hassle of finding a decent tenant, there are still factors to consider to locate the ideal investment opportunity for you. Let’s have a look at them below;
1. Location
Regardless of the type of NNN property you purchase, the location is the most crucial long-term decision you must make. The property you acquire should, ideally, have easy access to and from the road and be very visible to passers-by. It’s also beneficial to your business if it’s adjacent to other anchor stores, as these are known to bring in more people to other businesses.
Peradventure the lease expires or the one you now have closed, the location will be critical in attracting new tenants.
2. Rate of Capitalization
In general, a buyer should consider a NNN offer with a high cap rate. This implies you’ll spend less on the property you’re buying while still expecting to make a profit. Pep Boys outlets normally have a cap rate of 6.25 percent to 6.75 percent, as previously noted. In comparison to other NNN properties on the market presently, this is a pretty premium price.
If you’re confused about a property’s cap rate, you can quickly figure it out by dividing the property’s net operating income (NOI) by the purchase price (PP).
Mathematically, Cap Rate = NOI / PP
3. Legal Representation
When buying a NNN property, you should have legal protection just like you would when buying any other form of asset. This implies you’ll need legal guidance and advice throughout the purchasing procedure.
With that, you’ll be able to ensure that you receive a good title to the property and that it complies with all applicable state rules and regulations with their help. A legal advisor can also assist you to evaluate the purchase and selling agreement and identify potential risks during and after the acquisition.
Remember that any problem with the property you’re buying could jeopardize your entire investment, so don’t hesitate to seek legal advice.
Final Words
There you have it! Purchasing Pep Boys real estate for sale is one of the wisest investments you can make when it comes to NNN properties. As long as the company’s outlets generate positive sales income, you can expect excellent returns that will help you achieve financial independence.
To guarantee that you get the most out of your investment, though, you should do your homework and choose the best property available. However, you can make your work much easier and less stressful by following the tips above and seeking expert advice.
