Dollar General | 7.15% Cap | Tennessee
6% Population Growth | Abs NNN Lease
Marketing description
Exclusively offered is a fully-leased Dollar General store located at 2147 Watts Bar Highway in Spring City, Tennessee. This 2018 build-to-suit property features a 15-year absolute net lease with approximately 7.5 years remaining on the initial term. The lease includes five 5-year extension options with 10% rent increases in each option period. The property is corporately guaranteed by Dollar General Corporation, which holds an investment-grade credit rating of BBB from S&P.
Located in Rhea County, the property benefits from Spring City's strategic position between Knoxville and Chattanooga, with access to Highway 27 which carries approximately 9,550 vehicles per day. The area is experiencing steady population growth, with an estimated 6.01% increase projected over the next five years. Tennessee's income tax-free status provides an additional benefit for investors.
The offering presents an attractive 7.15% cap rate on a stabilized asset with a nationally recognized tenant in a growing market with limited retail competition.
Investment highlights
- 2018 build-to-suit construction for Dollar General
- Attractive 7.15% cap rate for a stabilized deal
- ±7.5 years remaining on an initial 15-year lease, which includes Five, 5-year extension options
- 10% rent increases in each of the extension periods
- Corporately guaranteed lease from Dollar General Corporation (S&P: BBB)
- Tennessee is an income tax free state
- Estimated population growth of 6.01% over the next 5 years
- Spring City is located 65 miles west of Knoxville and 50 miles north of Chattanooga
- Dollar General operates ±21,000 locations and plans to continue their expansion for the foreseeable future
- Dollar General has an investment-grade credit rating of BBB (S&P)
- Dollar General was considered an essential retailer and has proven to be one of the most profitable companies through the COVID-19 pandemic
- Dollar General has a market cap of ± 25 billion
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