Episode 4 – Retail Recap: Navigating the Financial Terrain

In this episode, hosts Jeremy Mercer, Will Narduzzi, Rob Franks, and Secure Net Lease’s Bob Moorhead dive deep into the current dynamics shaping the commercial real estate landscape, particularly retail and industrial assets. They cover everything from market shifts and tenant performance to zoning challenges and creative lease strategies. 

Key Topics Covered:

Retail Tenant Performance

  • Starbucks continues to oversaturate the market, but non-triple-net leases turn off investors.
  • Chipotle remains a strong performer with long-term, true NNN leases.
  • 7-Eleven is balancing its traditional convenience model with expansion into truck-stop formats.

Capital Markets & Bonus Depreciation

  • 100% bonus depreciation may return by mid-year, potentially unlocking more buyer demand.
  • Cap rates have widened slightly but remain attractive for credit tenants with long-term leases.

Distressed Assets & Reuse Strategies

  • Walgreens/CVS closures present backfill challenges; some owners are exploring creative reuses.
  • Bankruptcies like Party City and JoAnn are generating short-term leasing and redevelopment opportunities.

Winners & Losers in Retail Expansion

  • Whataburger, Velvet Taco, Aldi, and Sprouts are growing, while chains like On The Border, Red Lobster, and Denny’s are shrinking or filing BK.

Industrial Hurdles & Zoning Friction

  • Costly zoning overlays and surfacing requirements (especially in cities like Haltom and Frisco) complicate deals and increase timelines.
  • Zoning-by-right assets are heavily favored in the current environment.

Urban Redevelopment

  • Neiman Marcus’s downtown Dallas closure is a major cultural and retail loss.
  • Redevelopment of aging malls like Willow Bend points to continued demand for mixed-use, residential, and experiential reuse.

This episode offers a wide-ranging and candid look at the evolving landscape of commercial real estate, blending market data, boots-on-the-ground deal experience, and plenty of real estate “war stories” that investors, brokers, and developers will appreciate.

 

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SNL Facilitates All-Cash Sale of 7 Brew in Colorado

Secure Net Lease, a nationally recognized brokerage firm, successfully completed the sale of a 7 Brew Coffee location in Montrose, Colorado. The property was sold in an all-cash transaction to a private investor from Chico, CA who was motivated by a 1031 exchange.

The agent who facilitated the deal, Kyle Varni, commented, “It was a pretty straightforward and smooth process. We ultimately found a California buyer through an exchange, and it was an all cash deal. He owns a home in Telluride and visits the area frequently, so he’s very familiar with the real estate market there. Once we went under contract, the transaction was incredibly smooth.”

The 7 Brew Coffee property is a 510-square-foot drive-thru-only building situated at 1433 Encanto Place, Montrose, CO. The site benefits from high visibility at a hard corner location, with excellent traffic counts. Montrose County is a well-known destination for outdoor activities, drawing tourists year-round. Additionally, Montrose serves as a gateway to Telluride, which is only 40 miles away.

The buyer, a private investor from Chico, CA, was already well-acquainted with the Montrose and Telluride markets due to his frequent visits to the area. His familiarity with the region, combined with the growth of 7 Brew Coffee, made this investment particularly attractive.

This sale highlights Secure Net Lease’s expertise in identifying and matching premium net lease investment opportunities with motivated buyers. The transaction underscores the strong demand for high-traffic, drive-thru retail properties, particularly in tourist-driven markets like Montrose, Colorado.

Unlike most coffee chains, 7 Brew’s unique business model centers solely on drive-thru business, with no interior sit-down space in their compact 500-square-foot stands. Since 2017, 7 Brew has grown to over 210 locations in 26 states and continues to expand rapidly with a recent investment from Blackstone, the world’s largest commercial RE owner.

About Secure Net Lease

Secure Net Lease is a nationally recognized brokerage firm with offices in Dallas, TX and Los Angeles, CA that specializes in the acquisition and disposition of investment real estate. With over 100 years of collective experience, over $7.4B in sales, and transaction history in 48 states, Secure Net Lease consistently ranks among the top 10 of all brokerage firms nationally within their niche. Secure Net Lease works with developers, tenants, private and institutional owners to achieve market-setting cap rates for single- and multi-tenant net lease investments across the nation. Historically, 88% of Secure Net Lease offerings are new construction leased to nationally known tenants with 10+ years remaining on the primary term.

Secure Net Lease Sells DFW 7-Eleven

Secure Net Lease, a nationally recognized brokerage firm, orchestrated the sale of a 7-Eleven in Saginaw, Texas, just outside of Fort Worth. The property was sold in an all-cash transaction to a private buyer from Las Vegas, NV motivated by Bonus Depreciation.

The agent who orchestrated the deal, Edward Benton, said “I sourced an all-cash private investor buyer who was highly motivated by Bonus Depreciation benefits. The buyer quickly recognized the value of this 7-Eleven because of its proximity to Fort Worth.” 

This large format 7-Eleven store is a 4,088 square-foot building that sits on 1.44 acres on an irreplaceable hard corner that sees over 26,440 vehicles per day. The site features 21 parking spaces and 8 MPDs. It is only 6 miles from Downtown Fort Worth, just north of Interstate 820, which sees over 112,994 vehicles per day. Interstate 820 is a loop around Fort Worth that forms part of the larger Interstate 20 system. 

“The buyer moved quickly to secure the asset at full list price, demonstrating strong demand for well-located, income-producing net lease investments,” Benton concluded.

The sale of this 7-Eleven in Saginaw, Texas, highlights the strong demand for well-located net lease investments, particularly those offering attractive tax advantages like Bonus Depreciation. With its strategic positioning near Fort Worth and strong traffic counts, the property presented an attractive investment opportunity for the buyer. Secure Net Lease’s ability to match motivated buyers with premium retail properties highlights the firm’s expertise in navigating the net lease market.

7-Eleven, Inc. is the premier name and largest chain in the convenience-retailing industry. Based in Irving, TX, 7-Eleven operates, franchises and/or licenses more than 85,000 stores in 20 countries. They continue to develop new stores year-round and are constantly thinking of innovative ways to increase consumer engagement.

About Secure Net Lease

Secure Net Lease is a nationally recognized brokerage firm with offices in Dallas, TX and Los Angeles, CA that specializes in the acquisition and disposition of investment real estate. With over 100 years of collective experience, over $7.4B in sales, and transaction history in 48 states, Secure Net Lease consistently ranks among the top 10 of all brokerage firms nationally within their niche. Secure Net Lease works with developers, tenants, private and institutional owners to achieve market-setting cap rates for single- and multi-tenant net lease investments across the nation. Historically, 88% of Secure Net Lease offerings are new construction leased to nationally known tenants with 10+ years remaining on the primary term.

I sourced an all-cash private investor buyer who was highly motivated by Bonus Depreciation benefits.

Episode 3 – Retail ReCap: ICSC 2025 Live Coverage

In this episode, hosts Jeremy Mercer, Will Narduzzi, Rob Franks, and Secure Net Lease’s Bob Moorhead, along with guest Travis Alvarado from Velvet Taco and Matt Peterson from Estacado Interests, discuss current trends in retail and restaurant real estate while broadcasting live from the ICSC Red River event floor.

Key topics include:

  • Retail & Restaurant Market Trends
    • Post-pandemic real estate availability
    • Omnichannel strategies and experiential retail
    • Rising construction and operational costs
  • Velvet Taco’s Growth Strategy
    • Currently at 45 locations, expanding into Arizona, Florida, North Carolina, and Tennessee, with potential moves into Denver, Salt Lake City, and Las Vegas
    • Moving away from a rigid prototype model
    • Labor costs in high-wage states and how they are influencing market entry decisions
  • Regional Market Differences
    • Dallas, Houston, and Austin offer more expansion flexibility
    • Chicago and other older cities pose challenges due to expensive construction and strict labor regulations
    • Brands like Starbucks and McDonald’s are moving into smaller markets
  • The Role of ICSC & Industry Networking
    • Face-to-face deal-making at ICSC accelerates transactions
    • Networking opportunities help retailers, developers, and brokers align on real estate strategies and leasing deals

This episode highlights how adaptability, strategic flexibility, and in-person networking are crucial for success in the post-pandemic retail real estate market. Retailers and developers must stay ahead of trends, control costs, and be open to new market opportunities to thrive in 2025.

New episodes drop once a month, so tune in for your monthly dose of retail updates and commentary!

 

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SNL Sells Virginia 7-Eleven to 1031 Buyer from New York

Secure Net Lease, a nationally acclaimed brokerage firm, facilitated the sale of a newly constructed 7-Eleven in an affluent area of Hampton, Virginia. The property was sold to a private buyer from New York motivated by a 1031 exchange.

The agent who facilitated the deal, Matthew Scow said “This is a prime relocation site, with over 40 years of successful operations, which shows huge commitment to this prime trade area in Virginia.” 

This 7-Eleven site is a 4,650 square-foot building that sits on 1.16 acres at a signalized intersection that sees over 22,000 vehicles per day. The property is located 4 miles from Langley Air Force Base and 5 miles from Newport News Shipbuilding, the largest employer in Virginia. Hampton, VA is also home to 4 colleges: Hampton University (3,250 students), Old Dominion University (24,000 students), Christopher Newport University (4,500 students), and Virginia Wesleyan University (1,250 students).

“After reaching an agreement, the buyer went non-refundable and we successfully navigated the escrow process to secure the necessary financing and close the deal at a favorable cap rate,” Scow concluded.

The successful sale of this 7-Eleven property highlights Secure Net Lease’s expertise in delivering value to clients. With its prime location, long-standing operational history, and proximity to major economic drivers and educational institutions, the property represents a solid investment in the growing Hampton area. This transaction underscores the firm’s ability to identify high-potential opportunities and provide seamless brokerage services to its clients.

7-Eleven, Inc. is the premier name and largest chain in the convenience-retailing industry. Based in Irving, TX, 7-Eleven operates, franchises and/or licenses more than 85,000 stores in 20 countries. They continue to develop new stores year-round and are constantly thinking of innovative ways to increase consumer engagement.

About Secure Net Lease

Secure Net Lease is a nationally recognized brokerage firm with offices in Dallas, TX and Los Angeles, CA that specializes in the acquisition and disposition of investment real estate. With over 100 years of collective experience, over $7.4B in sales, and transaction history in 48 states, Secure Net Lease consistently ranks among the top 10 of all brokerage firms nationally within their niche. Secure Net Lease works with developers, tenants, private and institutional owners to achieve market-setting cap rates for single- and multi-tenant net lease investments across the nation. Historically, 88% of Secure Net Lease offerings are new construction leased to nationally known tenants with 10+ years remaining on the primary term.

Episode 2 – Retail ReCap Podcast: The Final Checkout of 2024

In the second episode of Retail Recap, titled “The Final Checkout of 2024: Retail Insights,” hosts Jeremy Mercer, Will Narduzzi, Rob Franks, and Secure Net Lease’s Bob Moorhead dive into the world of retail. From national trends to local developments, we’re here to give you the inside scoop on what’s driving the industry. 

Key topics include:

  • Cap rates and supply trends from national retailers such as 7-Eleven, Chipotle, Starbucks, and others
  • The rise of experiential retail
  • The integration of advanced technologies such as AI
  • Retailer expansion plans

The episode also examines the challenges retailers faced, including supply chain disruptions and shifting consumer behaviors, and discusses strategies employed to adapt to the rapidly evolving market landscape. This comprehensive analysis provides valuable insights for industry professionals and enthusiasts looking to understand the dynamic retail environment.

New episodes drop once a month, so tune in for your monthly dose of retail updates and commentary!

 

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Episode 1 – Retail ReCap Podcast: Who’s Up, Who’s Out, Who’s Next

Retail is constantly changing, and keeping up with its fast pace can be a challenge. Enter Retail ReCap, a new monthly podcast hosted by industry experts Jeremy Mercer, Will Narduzzi, Rob Franks, and Secure Net Lease’s Bob Moorhead. This series dives deep into the trends shaping the retail landscape, offering listeners valuable insights, thought-provoking analysis, and even a bit of fun.

In its inaugural episode, the podcast covers:

  • Tenant Trends: Who’s expanding, who’s downsizing, and who’s filing for bankruptcy?
  • Retail Stats: Examining occupancy rates, vacancy trends, and cap rates to understand the broader economic picture.
  • Big Brand Spotlights: Following industry leaders like Starbucks, Walgreens, Chipotle, and 7/11 to see who’s thriving and dominating.
  • Emerging Trends: From retention rates to innovative lease agreements and the rising popularity of mixed-use developments, the hosts explore what’s next for the industry.

With a tagline like “Who’s Up, Who’s Out, Who’s Next,” the podcast promises to keep you informed on the movers and shakers in retail. Whether you’re a seasoned industry professional, a curious observer, or someone with a passion for retail trends, Retail ReCap offers an engaging and insightful listening experience.

New episodes drop once a month, so tune in for your monthly dose of retail updates and commentary.

 

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SNL Sells 7 Brew Coffee to Tenant Buyer from Kansas

Secure Net Lease, a nationally recognized brokerage firm, orchestrated the sale of a 7 Brew Coffee in Red Oak, Texas. This property sold at a strong cap rate to a tenant buyer from Kansas in an all cash transaction.

The agent who facilitated this deal, Kyle Varni, said “Initially, we had a prospective buyer interested in the 7 Brew location in Odessa. However, we redirected their interest to the 7 Brew in Red Oak, which turned out to be a smooth transition.”

This 510 square-foot 7 Brew Coffee is located at a signalized intersection on a main retail corridor on East Ovilla Road (20,000+ VPD), just off of Interstate 35 (83,838+ VPD). It is only 1 mile from the $1+ billion Google and Compass Datacenters, 1.5 miles from Red Oak High School (2,160+ Students), and less than 2 miles from Texas State Technical College (10,200+ Students), the #3 Trade School in Texas. This high growth suburb of Dallas, Texas has strong income demographics and has had a 41.75% population increase since 2020.

“They exercised their right of first refusal (ROFR) on the location, simplifying the entire process for us. As a result, the closing was seamless, and the property sold at a strong cap rate relative to the area.” Varni concluded.

The successful sale of the 7 Brew Coffee in Red Oak, Texas, highlights Secure Net Lease’s expertise in efficiency and underscores the growing demand for well-positioned, high-traffic retail assets in thriving suburban markets. With a seamless closing process and a strong cap rate achieved, Secure Net Lease continues to deliver exceptional results for its clients nationwide.

Unlike most coffee chains, 7 Brew’s unique business model centers solely on drive-thru business, with no interior sit-down space in their compact 500-square-foot stands. Since 2017, 7 Brew has grown to over 210 locations in 26 states and continues to expand rapidly with a recent investment from Blackstone, the world’s largest commercial RE owner.

About Secure Net Lease

Secure Net Lease is a nationally recognized brokerage firm with offices in Dallas, TX and Los Angeles, CA that specializes in the acquisition and disposition of investment real estate. With over 100 years of collective experience, over $7.4B in sales, and transaction history in 48 states, Secure Net Lease consistently ranks among the top 10 of all brokerage firms nationally within their niche. Secure Net Lease works with developers, tenants, private and institutional owners to achieve market-setting cap rates for single- and multi-tenant net lease investments across the nation. Historically, 88% of Secure Net Lease offerings are new construction leased to nationally known tenants with 10+ years remaining on the primary term.

Secure Net Lease Sells Advance Auto Parts to Texas 1031 Exchange Buyer

Secure Net Lease, a top ranking brokerage firm, facilitated the sale of an Advance Auto Parts in Hondo, Texas, right outside of San Antonio. The property was sold in an all-cash deal to a local 1031 exchange buyer.

The agent who orchestrated the deal, Anthony Pucciarello, said “We recently sold both this Starbucks and an Advance Auto Parts location in Hondo to the same 1031 exchange buyer. The transaction was incredibly smooth, as the buyer, a motivated investor, closed the deal within about 14 days of signing the contract.”

The 6,889 square-foot building is strategically located on the I-90 & I-173 Interchange, which sees over 25,000 vehicles per day. It is positioned in a dense retail corridor with anchor tenants H-E-B, Walmart, and Tractor Supply. Other nearby national tenants include McDonalds, Taco Bell, Whataburger, Best Western and more. This property is also near South Texas Regional Airport and Hondo High School. 

“The buyer was a local exchange buyer from Round Rock who had just sold his family ranch nearby, so he was already familiar with and fond of the area. Our seller had the opportunity to meet him in person at the property, which further strengthened the relationship. Now, the buyer has expressed interest in purchasing additional properties from us in the future” the agent concluded.

The property’s prime location, surrounded by high-traffic businesses and close to key landmarks, made this an attractive investment. The buyer, familiar with the area, completed the deal swiftly within 14 days. This transaction has fostered a strong relationship between the buyer and Secure Net Lease, with potential for future collaborations on additional property sales.

Advance Auto Parts is a leading provider of automotive aftermarket parts, serving professional mechanics and DIY customers. As of 2024, the company operates 4,781 stores across the U.S., Canada, Puerto Rico, and the U.S. Virgin Islands, along with supporting 1,125 independently owned Carquest locations. Advance Auto Parts reported annual revenue of approximately $11 billion for its most recent fiscal year​. 

About Secure Net Lease

Secure Net Lease is a nationally recognized brokerage firm with offices in Dallas, TX and Los Angeles, CA that specializes in the acquisition and disposition of investment real estate. With over 100 years of collective experience, over $7.4B in sales, and transaction history in 48 states, Secure Net Lease consistently ranks among the top 10 of all brokerage firms nationally within their niche. Secure Net Lease works with developers, tenants, private and institutional owners to achieve market-setting cap rates for single- and multi-tenant net lease investments across the nation. Historically, 88% of Secure Net Lease offerings are new construction leased to nationally known tenants with 10+ years remaining on the primary term.

Now, the buyer has expressed interest in purchasing additional properties from us in the future.

Maximizing Bonus Depreciation

Since 2017, Bonus Depreciation has been a powerful tool for commercial real estate (CRE) investors looking to offset significant capital gains or passive income. However, this benefit is set to gradually phase out, creating a limited window of opportunity. For investors focused on tax deferral strategies, Bonus Depreciation offers unique advantages over traditional methods like 1031 exchanges or opportunity zones. With the impending sunset of this tax break, now is the time to act—especially for those interested in investing in gas stations and convenience stores (C-Stores).

What is Bonus Depreciation?

Bonus Depreciation allows investors to accelerate tax deductions by writing off a substantial portion of a property’s cost in the year it is placed into service, as opposed to the traditional 39-year depreciation schedule used for most CRE. Initially raised to 100% under the Tax Cuts and Jobs Act of 2017, Bonus Depreciation applies to qualifying assets with a recovery period of 20 years or less. This allowed investors to immediately write off the full cost of improvements and assets placed in service after September 27, 2017.

However, the rules are now phasing out. Starting in 2023, the Bonus Depreciation rate began decreasing by 20% each year and will drop from 60% this year to 40% in 2025, before being phased out completely by 2027—unless Congress extends the provision.

Why C-Stores Are the Ideal Property for Bonus Depreciation

Convenience stores with gas stations are particularly attractive investments under the Bonus Depreciation rules because these properties often meet the qualifications for accelerated depreciation. Investors who own properties leased to high-credit tenants like 7-Eleven, QuikTrip, or Circle K can leverage Bonus Depreciation to offset both ordinary income and capital gains, potentially creating significant tax savings.

For example, if an investor purchases a $5 million C-Store, excluding the land value, a large portion of that cost can be deducted upfront, resulting in potentially hundreds of thousands of dollars in tax savings. These properties, when leased to creditworthy tenants, provide not only tax advantages but also long-term income stability.

Why Investors Are Focusing on C-Stores Now

The demand for C-Stores as investment properties has surged, especially those with long-term net leases to tenants like 7-Eleven, QuikTrip, and Murphy Oil. These properties have proven to be recession-resistant, outperforming other sectors during the pandemic due to their essential nature. With corporate-backed leases that guarantee income streams, they offer both stability and security.

Those are compelling reasons why newly opened, corporate-leased C-Stores are in high demand, often selling out quickly. The inventory of new 15+ year NNN leased 7-Eleven properties, that qualified for Bonus Depreciation, were entirely sold out prior to year-end 2023. The scarcity of available inventory, combined with the looming phase-out of Bonus Depreciation, makes these properties even more attractive to investors looking for a safe, tax-advantaged opportunity.

How Bonus Depreciation Works

Bonus Depreciation offers several advantages when compared to the standard depreciation timeline of 39 years for CRE. By accelerating the depreciation of qualifying assets, investors can write off the entire cost (minus land) much faster. This creates significant tax deferral opportunities, allowing investors to reinvest those tax savings into new ventures.

For C-Stores with a retail motor fuel component, the entire purchase price of the property (excluding land) may be eligible for Bonus Depreciation if specific conditions are met. This includes both the building and any improvements made to the property.

Key Tests for Qualifying C-Stores

Not all C-Stores qualify for Bonus Depreciation. The property must meet the definition of a “retail motor fuels outlet,” and must pass one of the following tests:

  1. At least 50% of the C-Store’s gross revenue comes from petroleum sales.
  2. 50% or more of the floor space is dedicated to petroleum marketing activities (including restrooms, counters, and service areas).
  3. The C-Store occupies 1,400 square feet or less, regardless of revenue or floor space.

Properties that meet one of these tests are eligible to be depreciated over a shorter 15-year period using a 150% declining balance method, making them perfect candidates for Bonus Depreciation. However, it’s important to note that ground leases do not qualify, as land itself is not depreciable.

The Future of Bonus Depreciation: What to Expect

The future of Bonus Depreciation is uncertain. In early 2024, the House of Representatives passed legislation to extend the benefit, but it remains stalled in Congress due to political gridlock ahead of the recently completed presidential election. As it stands, the law is set to phase out completely by 2027.

In 2024, the Bonus Depreciation rate is fixed at 60%, offering a shrinking window of opportunity for investors to benefit from this tax strategy. By 2025, the rate will drop to 40%, further reducing the advantages. Given the uncertainty of an extension, investors should act quickly to maximize the remaining benefits.

Real Estate Investment Benefits

In addition to the tax savings offered by Bonus Depreciation, investing in C-Stores provides other key benefits. These properties are often located in high-traffic areas with excellent visibility and vehicle access—prime real estate for retailers. C-Stores tend to be meticulously vetted by tenants, ensuring that each location is positioned for strong sales performance.

The stability of long-term leases, combined with no maintenance responsibilities typical of net lease agreements, further enhances the appeal of these investments. For investors seeking reliable income streams with reduced management burden, C-Stores leased to creditworthy tenants represent one of the best opportunities in the NNN market.

Act Now to Capitalize on Bonus Depreciation

There is still time to take advantage of Bonus Depreciation, with the rate set at 60% for 2024. Investors who act now can lock in significant tax savings before the benefit continues to phase out. Whether you’re new to commercial real estate or an experienced investor, Bonus Depreciation offers a smart tax planning strategy to offset taxable income and boost returns.

Secure Net Lease has closed escrow on nearly 500 C-Store properties, totaling over $2 billion in transactions. The firm’s dedicated research team tracks every convenience-store property that comes to market in real time, allowing it to offer unmatched insights and access to prime investment opportunities. Contact Secure Net Lease today to learn how to capitalize on this powerful tax strategy before it’s too late.

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