Napa Auto Parts TENANT OVERVIEW


Pros

  • Corporate guaranty
  • NNN leases with rental increases in the primary term

Cons

  • Not rated by S&P or Moody's
  • Often located in middle-to-low income areas

Tenant Description

Napa Auto Parts locations can offer a unique opportunity for a buyer to acquire a recession-resistant investment, with an attractive lease containing rental escalations. Napa leases are often NN leases, requiring some landlord responsibility, such as roof and structure. These leases are guaranteed by an investment grade tenant. The underlying asset is also attractive, with Napa stores typically located on a busy retail corridor.

Auto parts stores remain in high demand among net lease investors, as there are very few investment grade options that are priced below $2 million, with the exception of dollar stores. The retail auto parts industry continues to thrive as the age of vehicles on the road continues to increase.

In 1925, a group of independent auto parts sellers met in Detroit to form the National Automotive Parts Association. Their mission was simple: improve the distribution of auto parts to serve the people and businesses who increasingly relied on cars and trucks for their transportation needs.

In 1936, NAPA opened its first location, an existing Atlanta auto parts store purchased from an owner who thought the industry was past its peak. It wasn't even close.

Nearly a century later, NAPA continues to serve auto service professionals, do-it-yourselfers and everyday drivers with quality parts and supplies to keep cars, trucks, and equipment performing safely and efficiently.

In the US, NAPA now includes 57 distribution centers and nearly 6,000 independently-owned and company-owned stores. NAPA carries an extensive inventory of more than 475,000 parts for automotive and industrial applications.

A division of Genuine Parts Company (NYSE: GPC) and a global automotive aftermarket leader, NAPA operates NAPA Canada, Auto Todo in Mexico and Repco in Australia and New Zealand.

Average Cap Rate
6.48%
12 mo avg with 10+ yr lease term
Average Property & Lease
Average Sale Price $1,066,154
NOI $68,703
$/Square Foot $100 - $250
Building SF 7,000
Lot Size 0.5 - 1.5 Acres
Lease Term 10 Years
Escalations Varies
Stock Symbol N/A
Credit Rating
S&P N/A
Moody's N/A
Average Cap Rate Trend
7.19%
2015
6.98%
2016
Rates reflect last 12 mos, short and long-term
Recent Sales Comps
Fresno, CA 7.70%
Palm Harbor, FL 6.70%