Royal Farms
5% Cap Rate | 20 Year Absolute NNN Ground Lease | Just Opened March 2025
Marketing description
KLNB Retail Capital Markets is pleased to offer for sale a newly constructed Royal Farms convenience store and gas station located at 21779 Tulagi Place in Lexington Park, Maryland. The store officially opened for business in March of 2025 and is situated at the gateway to the Patuxent River Naval Air Station, a key economic hub with approximately 20,000 employees. This property offers a strategic location at a signalized hard corner with high visibility and traffic flow of 40,000 vehicles per day. With a 20-year absolute triple net ground lease, investors can enjoy a passive investment opportunity with no landlord responsibilities. Rental increases of 10% every five years, starting in year 11, ensure consistent cash flow growth and inflation protection. Operated by Two Farms, Inc., Royal Farms is a well-established regional brand with over 300 locations, providing a trusted and reliable tenant for long-term stability.
Investment highlights
PRIME LOCATION ON SIGNALIZED HARD CORNER AT THE GATEWAY TO PATUXENT RIVER NAVAL AIR STATION
Royal Farms is strategically located at the primary access point to the Patuxent River Naval Air Station (NAS), a major economic anchor since the 1940’s with approximately 20,000 employees in the area.
Patuxent River NAS buoys the region, supporting a roster of Fortune 500 defense contractors including Lockheed Martin and Northrop Grumman.
Ideally positioned at the signalized intersection of Great Mills Road and Three Notch Road (Rt. 235), the highest trafficked intersection in the submarket with a combined 40,000 vehicles per day (VPD).
Clear visibility and access to both major roadways with multiple points of ingress and egress.
NEW CONSTRUCTION, LONG-TERM ABSOLUTE TRIPLE NET (NNN) GROUND LEASE
Brand-new Royal Farms set to open in Q1 of 2025, creating a prototypical convenience store and gas station.
20-year lease structure with zero landlord responsibilities, offering stable, hands-off income for investors.
10% rental increases twice during the initial lease term, and in each of the four, 5-year renewal options, ensuring consistent cash flow growth and hedge against inflation.
Established regional brand with strong market presence, operated by Two Farms, Inc., the parent company of Royal Farms, a trusted and well-known brand in the Mid-Atlantic with over 300+ locations.
DESTINATION CORRIDOR IN AFFLUENT AND GROWING SUBMARKET
Positioned directly across from the Pax River Village Center, 25-acre grocery-anchored retail project under renovation, with an influx of national retailers to the submarket, including AMC Theatres, Aldi, Dollar Tree, Jersey Mike’s, Bank of America, and Starbucks which cultivates a destination retail environment.
Affluent consumer base in a high-quality of living location: 29,000 residents earning $113,000 average household income within a 3-mile radius with projected population and income growth through 2029.
Tremendous employment corridor with daytime population increasing to 35,500 within 3-miles radius.
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