With the normal net lease investment for a retail Walmart averaging around ten million dollars, they have a naturally high barrier to entry for individual investors. Often times such transactions are made by group entities, given that a standard retail building may span from 51k sq. ft. to 224k sq. ft. in size. Typically, the dimensions will average about 102k sq. ft.; this data is of course skewed by the sheer size of Walmart Supercenters which tend to be 197k sq. ft. However, they can range from 98k-261k in size and usually include a complete grocery store alongside the department store. Given their high yearly rental costs with lower capitalization, caps are generally found between 6 and 7 and depend on the negotiations per individual lease agreement.
Lowest Cap Rate
Lowest cap rate over past 24 months
Average Cap Rate
12 mo avg with 5+ yr lease term
Average Property & Lease
|Average Sale Price||$3,500,000 - $15,000,000|
|Average NOI||$200,000 - $750,000|
|Lease Term||20 Years|
Originated in 1962 by Sam Walton, Walmart was officially born in October of 1969. Just a few years later, they would be listed on NYSE and become the biggest grocer and wholesale discount retail chain in the United States. By 2010, they achieved worldwide status for gross sales revenue annually, retaining corporate headquarters in Bentonville, AK. They additionally acquired Sam’s Club into their company portfolio, now having approximately 8500 retail locations. Internationally, Walmart operates in fifteen countries under dozens of various brands, retaining the Walmart branding exclusively in the U.S.A.
- Highly visible locations
- Company guaranty, investor grade
- Lower price renting / sq. ft.
- Allows for lower interest rates
- Flat fee renting, price bumps uncommon
- Difficult to repurpose if tenant moves
COMPANY QUICK STATS
|Number of Locations||10,585|
|Key Principal||Doug McMillon|