Savvy investors are always on the hunt for their next venture, and alternative property types have grown in popularity over the years. But one of the most stable alternative investment properties may surprise you: gas station-convenience stores.
Gas stations with attached convenience stores are low-risk, long-term investments that provide income flow for years to come, but there are always many factors to consider before investing in commercial real estate.
Learn about the pros and cons of gas stations as NNN investments and how you can find the perfect investment property with Brisky Net Lease!
Reasons to Consider Purchasing a Gas Station
The gas station-convenience store combination is a seemingly basic idea that significantly impacts our economy and everyday lives. They provide essential services and products that don’t depend on the advancement of technology, keeping them relevant since the invention of the automobile.
Gas stations evolved to fit modern-day customer and market demand by offering reward programs, comprehensive shopping capabilities, partnerships with grocery stores, and more. Even throughout multiple economic crises and significant world events, gas stations’ revenue has continued to grow.
Location
Regarding NNN lease investments, you should always consider a gas station/convenience store’s location before investing in the property. Choosing a site in a high-traffic area with access to drug stores or fast food businesses will bring more people to your location.
NNN Lease Terms
Depending on the tenants, gas station-convenience store NNN leases can run for up to 25 years. You’ll also worry less about the effects of inflation, as there should be set contract terms allowing you to increase the property’s rent.
Regardless of a gas station company’s preferred lease type, you’ll be paid rent, and you won’t have to worry about maintenance or other issues.
Creditworthy Tenants
You should always ensure that your gas station/convenience store tenants have good-standing credit, a low risk of defaulting on loans or payments, and be financially stable.
As an NNN lease investor, it’s important to always do your due diligence and perform a financial assessment for the potential tenant to protect yourself and your investment.
Potential Risks
No investment comes without risk, so it’s important to acknowledge the potential risks of owning a gas station. In urban or suburban markets, it can be hard to find an ideal location, as there is a lot of competition and little room for more competitors. On the other hand, locations in rural markets may not enough customers to be profitable due to the smaller population.
There is also a risk of fire or environmental contamination due to possible fuel leaks, combustive materials, and human error. However, you can always minimize the chance of something like this happening by taking preventive safety measures.
Completing regular inspections and equipment maintenance, following safety procedures, and investing in proper insurance coverage are simple things that can make a huge difference.
Choosing a Gas Station for an NNN Lease
The NNN market is moving fast, so you need to know what you want in a gas station and a convenience store before taking the plunge. To help maximize your potential profits, consider hiring a representative before negotiating lease terms, as a high ROI is the ultimate goal.
Another important factor when considering investing in a gas station-convenience store is the property’s condition and curb appeal.
A gas station that looks worn down will not generate the same income as a “nice-looking” one, and you might spend more money on updates and repairs.
Choose an NNN Lease Partner You Can Rely On
For help finding the perfect NNN investment property, get in touch with the professionals at Brisky Net Lease. Our professional team can identify the best properties in the best locations — helping you meet your financial goals.
With our extensive commercial real estate track record, you’ll walk into your next lease negotiation confidently and with an experienced team on your side.
Contact us today to learn more about our available properties and buyer representation services.