Graphic titled ESSENTIAL BUSINESS RETAIL with pictures of a 7-Eleven in Chicago at night, a Dollar Tree in Texas and a McDonald's restaurant.


Graphic titled ESSENTIAL BUSINESS RETAIL with pictures of a 7-Eleven in Chicago at night, a Dollar Tree in Texas and a McDonald's restaurant.

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Is Physical Retail Dead?

People have been asking for the last 10 years “Isn’t physical retail dead?” or “Won’t Amazon sell everything online?”  “Isn’t physical retail dead, especially now with concerns of a virus?”  You may have asked this too and the resounding answer is no!  Certain segments of retail real estate and retail services have been thriving the past few years and have gained momentum with the outbreak of the pandemic in 2020.

The reports of my death are greatly exaggerated.

Mark Twain (upon hearing his obituary had been published mistake)

Net Lease Retail Real Estate Has Been A Stand Out Performer In 2020

Believe it or not, but one of the top performing asset classes in 2020, at the peak of the pandemic, has been Essential Business retailers and service providers.  Rents have remained steady because long term leases and the closing of other stores have made these retailers and service providers more in demand, more productive and created higher earnings. Compared to multifamily (apartment rental buildings), which have suffered from renters not paying and shopping malls that were shuttered by lockdown orders, essential business single-tenant net-lease retailers have thrived.  What industry types performed best?  We answer that question below.  But first, a little history of how we got here.

Retail and Shopping Patterns Have Constantly Evolved

Physical retail stores (“bricks and sticks” or “brick and mortar”) are not going away and, in certain situations, are even growing. Retail has continuously evolved and seen a cyclical development: from the trading post to the local general store (see picture), then disrupted by the Sears catalog that in turn started opening department stores only to be replaced by Walmart, and now Amazon has come along as the first Trillion dollar company.

These businesses with multiple locations are commonly referred to as “Chain Stores” or abbreviated as “Chains” because they have a chain of locations across a region, country or even an international marketplace.  Some notable international tenants are Aldi, Carrefour, Gap, McDonalds, KFC, 7-11, Jollibee and Daiso.

Amazon, started as an online book store then killed all the physical book stores and has now come full circle by opening Amazon Books as physical stores.  A few years back they bought Whole Foods for $13.7 Billion and are now opening AmazonFresh locations, which are 40,000 square-foot (3712 square meters) supermarkets. They also operate Amazon Go, Amazon 4 Star and lease several former grocery stores as “Dark Stores” that operate as last mile distribution centers.

Department stores like Macy’s, Sears, and J.C. Penney will probably disappear along with other retailers who have not changed to meet the new realities of retailing. 

However, there is a thriving group of tenants who present excellent investment opportunities in the net lease real estate sector that are essential businesses and services who serve consumers’ daily needs and offer convenience not capable of being delivered online.



For certain segments of the population, they either love to work on their cars or have to fix their own cars because of budgetary reasons.  Advance Auto Parts (NYSE: AAP), AutoZone (NYSE: AZO), O’Reilly Auto Parts (NASDAQ: ORLY) and NAPA Auto Parts (Genuine Parts Company) are the largest chains. Between 2015 and 2020, the aftermarket auto parts industry has shown slow and steady growth. The total number of vehicles on the road has increased and the average age of vehicles being driven is getting older. As cars and trucks become older, they require more frequent maintenance and repairs, which bolsters demand for auto parts. Mechanics and repair facilities will also utilize auto parts chains in addition to their normal suppliers. During the 2020 pandemic, auto parts stores were deemed “Essential Businesses” in some US states but were forced by government edict to shut down in other states.  (Liberty Real Estate Fund avoids investments in over-regulated and arbitrary states.)


Automotive services cannot be performed on the internet and driving is not going away any time soon. Someone once said more people will be taking Uber and Lyft and will not be driving as much. We responded that the Uber and Lyft drivers will need their cars serviced. Winners in this industry category have been quick oil change brands, such as Jiffy Lube International (owned by Shell Oil Company), Valvoline Instant Oil Change, Grease Monkey, Havoline, Take 5 Oil Change and Grease Monkey. These brands are either franchised or owned by oil companies. Some of the corporate owners and franchisees are well-capitalized private equity firms. 

Tire companies are also excellent credit-tenants with Firestone owned by publicly traded Firestone/Bridgestone (Tokyo: BRDCF) and also Goodyear (NASDAQ: GT) as a billion-dollar public company. Tire Kingdom, Mavis and several other regional companies have strong corporate backing, as well. 

For general auto repairs, Christian Brothers and Pep Boys (NASDAQ: IEP) are good tenants at this time that have been attractive to net lease investors.

Collision repair chains also have good credit but are sometimes overlooked by investors. The big four auto body chains are: ABRA Auto Body & Glass, Caliber Collision, Gerber Collision & Glass and Service King.  A point to remember is that sometimes the locations for these facilities are not always the best retail locations.


Most large banking institutions have excellent credit, which makes them a good choice for both experienced and inexperienced net lease investors. Banking locations are usually well positioned at excellent locations and predominantly have drive-thru operations. One hesitation with this net lease industry sector is that banks have been consolidating branches as financial services migrate online. For now, they are opening smaller, more digitally focused facilities that still provide many services that need to be completed in person. 

We have extensive experience with bank branch portfolios with both occupied and vacant bank branch repositioning. Bank branches, because of their locations, can be reused for many different purposes and, in most cases, come with “grandfathered” (a provision when an old regulation continues to apply to an existing property) drive-thru approvals, which are sometimes hard to obtain in certain jurisdictions.

When a bank branch does close, net lease investors have options for refilling the space with other banks and financial institutions if it is a good location. This is why location is paramount, even over financial strength or brand name. Bank branches can also be  repurposed as restaurants, service business offices, government offices and healthcare clinics. In certain situations, we have sold vacant bank locations to developers who demolished the building and repurposed it into a CVS drug store or a local government space as part of assembling a larger parcel for a planned development.


Car washes have been a standout investment in net lease properties and have become very viable investments.  Cars get dirty and need to be periodically washed, which makes this a regular recurring expenditure for millions of consumers.  The car wash business model as a recurring service along with only being able to obtain this service in person makes it internet-resistant.  Additionally, better operators are selling monthly subscription services for recurring revenue, even if the service is not used and consumers prefer a touchless experience due to industry automation. 

Investors must be careful because this is a fragmented industry and poorly capitalized competitors could get washed out if they don’t maintain the equipment and vacuums. The car wash industry is right for consolidation but as of right now they are not large national operators. Regional operators with slightly stronger corporate parents or private equity backings have recently been expanding rapidly. As in all single tenant triple net lease assets, the crucial criteria should be a superior location on a high traffic road and the financial strength of the tenant should be sufficient to pay rent over the life of a 5- to 20-year lease. If the location is good enough, it can overcome a weak operator but it is better to have both financial backing with a good operator and a great location. 

For example, we leased some excess land to a car wash operator in 1996 who then after 7 years sold the business to a better operator who sold the business to a stronger capitalized car wash chain that demolished the original facility and built a more modern, touch-free automatic tunnel style car wash.


Convenience stores, or C-Stores ,have been excellent performers and have proven to be recession-resistant. A convenience store with a fueling station is a must to drive consistent consumer traffic. Convenience stores are relatively recession-resistant due to the recurring need to obtain fuel for automobiles and the ease of purchasing other daily-needs items, snacks or soda without having to navigate a larger store and wait in long lines.  There are some unique tax benefits for convenience stores that have a gas station component because they can be classified as a fueling center for IRS purposes. Any other larger brand convenience stores without a fueling station will more than likely not renew and be a candidate for a relocation store.

Net lease convenience store properties are mostly located at signalized corners or on the outparcel of a highly trafficked shopping center. They usually have excellent visibility to motorists and multiple points ingress/egress (curb cuts or driveways to enter the property). Most C-store locations are at the intersection of high traffic roads and streets near highway entrances and other auto- and foot-traffic generators.

The most notable feature of convenience stores is the excellent credit backing some of these chains like: 7-Eleven Inc. (AA- credit and 70,000 locations worldwide including more than 11,000 in North America); Shell Oil Company (AA- credit with 44,000 branded locations in 80 countries); BP  (AA credit with 18,700 locations – $4 Billion profit in 2019); Circle K/Alimentation Couche-Tard (BBB credit and more than 15,000 locations worldwide including Ireland, Russia, Poland and Sweden); Casey’s General Stores Inc. (CASY: NASDAQ with 2,207 locations); Murphy USA Inc. (BB with 1489 locations)  Wawa Inc. (BBB credit with 880 locations). Also, QuikTrip Corp. (with 823 locations); Kwik Trip Inc. (with 708 locations);  Sheetz Inc. (with 605 locations); and RaceTrac Petroleum (with 558 locations). There is substantial financial backing when signing the contracts and writing rent checks within this Net Lease industry segment. These companies are worldwide operators with billions of dollars in sales.

Another excellent subcategory of the convenience/fueling industry is Travel Centers/Truck Stops, which are usually located near highway interchanges and, in addition to diesel/gasoline fueling, also typically provide full-service or fast food restaurant meals ready to go, coffee, restrooms, showers and other amenities that cater to truck drivers and long-distance travelers. The largest operators in this segment are Flying J/Pilot Travel Centers LLC (750 locations), Love’s Travel Stops & Country Stores Inc. (508 locations), TravelCenters of America (271 locations) and Road Ranger (74 locations).

Additionally, several large supermarket operators have convenience stores/fueling stations either connected to a full service supermarket or as stand-alone units like the 220-store GetGo chain owned by Giant-Eagle supermarkets.


The biggest winners have been Walmart, Target, Costco, Sams and BJs. These giants have been vacuuming up market shares for the past 20 years. Walmart is the US’s largest grocery chain and during the pandemic Costco, Target, Sam’s and BJs have been the one-stop shopping place for people otherwise locked in their homes.

Walmart (NYSE: WMT), with AA-rated credit, is a behemoth with 11,500 stores under 55 names in 26 countries and has a large eCommerce presence creating over $524 Billion in sales. Walmart also owns Sam’s Clubs (270 locations named for Sam Walton, founder of Walmart). There is an array of opportunities to invest in Walmart Net Lease properties from a full-sized Walmart Supercenter (180,000 square feet/16,722 meters) in the $15–$30 Million price range down to the Walmart Neighborhood Market (40,000 square feet/3,716 meters) in the $5–$10 Million price range. There are also Walmart distribution center industrial Net Lease opportunities. Walmart’s closest competitor in the US is Target (NYSE: TGT and has A- credit rating with 1,900+ locations) with about $75 Billion in sales. Target was started as the discount division of the Dayton Hudson’s Department stores to eventually outgrow the parent company as their fortunes diverged. 

Carrefour SA and Auchan are both hypermarkets (supermarket/discount department store combination) based in Europe are also excellent net lease investment tenants and have multiple concepts and facility sizes.

Costco Wholesale Club (NASDAQ: COST and an A+ credit rating) has perfected the members-only warehouse retail concept and generates more than $150 Billion in sales from 800 locations in the United States & Puerto Rico, Australia, Canada, France, Iceland, Japan, Korea, Mexico, Spain, China and the United Kingdom. Due to their large size (Costco stores range from 80,000 square feet to 200,000 square feet with a prototype size of 145,000 square feet/13,500 square meters) and limited availability, Costco net lease investment opportunities are typically $15 Million plus purchase prices.  BJ’s Wholesale Clubs (210 locations in northeast US) was an offshoot of the Zayre discount department stores similar in the same way that Sams came from Walmart. BJ’s operates mostly along the east coast of the US. Internationally, Metro AG, City Club and Makro all operate membership club stores.

Meijer, based in Grand Rapids, Michigan, was one of the first Hypermarket/Super Center concept operators in the United States and is arguably one of the top chains in the US.  It is one of the largest privately owned companies in the US and its typical store size is 150,000 to 250,000 square feet.  The stores carry groceries, a full-line discount department store, pharmacy and usually a fueling center on an out parcel. Meijer typically owns their stores and real estate but are excellent credit tenants and one of the most honorable companies in the world. We have had the privilege of completing one of their first leases and look forward to buying more in the future.


The dollar store segment has exploded over the past 20 years and is classified as retail-variety stores. Dollar Stores have replaced the old “Variety stores”, also known as “Dime Stores” and “Five and Dime” for a wide variety of merchandise priced at 5¢ and 10¢. These chains, such as Ben Franklin, Woolworth, McCrory and G.C. Murphy, all have been replaced by Dollar General, Dollar Tree, Family Dollar, 99 Cents Only Stores and Daiso (“the Japanese dollar store” with over 5,100 stores worldwide). 

The typical dollar store will carry a limited assortment of grocery (sometimes fresh produce and also frozen foods), packaged food, snacks, paper products and household cleaning supplies, health and beauty products, some apparel, school supplies, candy, gift items, toys, housewares, home goods, party supplies, pet supplies and seasonal items like coolers in the summer, Halloween candy and decorations in the fall, Christmas decorations and gifts in the winter.  Select stores carry beer and wine. Some stores will carry close-out and overstocked items that have been returned or out of season.

Dollar General bills itself as Dollar General describes itself as America’s general store.   Dollar General has stores concentrated in rural locations, which makes them a one-stop place for customers – who have few other options nearby – to buy everything from home decor, party supplies to everyday essentials. Dollar General intends to keep expanding its store count in 2021 with plans to open more than 1,000 new stores and remodeling close to 1,800 existing stores.  DG currently operates more than 17,000 stores in the United States. 

Both Dollar Tree and Family Dollar are owned by Dollar Tree, Inc. (DLTR = Baa2/BBB) with Dollar Tree in freestanding locations along with malls and strip centers.  Family Dollar targets lower income demographics and its leases tend to be NN with the landlord responsible for roof, structure and major repairs.  Dollar Tree has seen significant sales growth in 2020 and continues to renovate it’s Family Dollar brand to its new H2 store concept which has added an average of 10% to same store sales.  Seasonal items have been a huge  hit in both brands.  Dollar Tree is also testing a multi price point concept called Dollar Tree Plus.  It will be rolling out over 500 stores with this concept in 1st quarter 2021.

99 Cents Only Stores (393 locations) bills itself as “the leading operator of extreme value stores”  They are headquartered in California and also operate stores in Texas, Arizona and Nevada. Since 2017 99¢ has been owned by Ares Management and Canada Pension Plan Investment Board.  99¢ did have financial troubles in 2018 and 2019 but is a private company so does not report sales to the public and has not filed reports with the SEC for a few years. 

A recent entrant into the US market opening on both the West and East coasts is Daiso (“the 100 Yen = ¥ store”) and already boasts of more than 80 stores in the US.  It remains to be seen if this worldwide favorite will appeal to a wider shopping audience or stay focused on the Asian ethnic and urban chic markets.  A typical Daiso carries Japanese Theme products, Kitchen Tools, Toys and Sporting items along with Arts & Crafts.

Five Below (FIVE:NASDAQ) is a new entrant into the variety store, which true to its name sells merchandise that cost less than $5.00. The chain is aimed at teenagers and pre-teens (Gen-Z).  Five Below founders, David Schlessinger and Tom Vellios had previously founded the rapid growth toy/book chain Zany Brainy. Five Below sells the same types of items as other dollar stores (school supplies, simple electronics, toys, sporting goods, inexpensive clothes, candy, beauty supplies.  Their merchandising is a cross between dollar store and TJ Maxx (they describe themselves as the TJ Maxx for kids).  They only carry items for a limited amount of time, once they are sold, the item is no longer carried.  It is the “treasure hunt” concept.    At this point in time most of the Five Below stores are inline within shopping centers.  The store sizes are 8,000 to 10,000 square feet) which could make them an excellent replacement tenant for a CVS, Walgreens or Dollar Tree in regional shopping center locations. 

In Canada, Dollarama is the largest retail chain of items under four dollars (Loonie = 1 CAD) and is headquartered in Montreal. Dollarama has 1,000+ stores across the country of Canada.


CVS, Walgreens and Rite Aid have performed exceptionally well during the last year.  Over the past 20 years drug stores in the US have moved their facilities to high traffic, high visibility, free standing stores that have a drive through pick up window.  During the pandemic these retailers were considered essential businesses to provide life saving medical supplies, filling prescriptions, health and wellness products, staple foods and household supplies such as toilet paper.  These corporations have a physical platform to provide health, drugs and in-person healthcare. 

Walgreens/Boots operates 13,100 stores across 11 countries, controls, maintains AllianceRx Walgreens Prime specialty home-delivery pharmacy, plus operates Take Care Health Clinics as stand alone units and in its stores. Walgreens and VillageMD expanded their partnership to spend $1 billion to open 500–700 primary care offices over the next five years. Walgreens has also partnered with FedEx for shipping, pick-up and return services at more than 8,000 of its stores. Walgreens’ US footprint puts it within a 5-mile reach of 75% of the US population. Boots is owned by Walgreens Boots Alliance and operates stores in the United Kingdom, Ireland, Thailand, Norway and the Netherlands.

CVS/Aetna is the combination of the largest pharmacy chain and one of the largest US health insurance companies.  The chain boasts nearly 10,000 CVS stores, serves 23 million Aetna members and operates 1,100 MinuteClinic locations.  CVS also operates more than 200 “CVS Pharmacy y más” stores that are located in Hispanic areas and carry more grocery items and Hispanic brands. 

The third largest drugstore chain is Rite Aid, with approximately 2,500 locations, but has been losing market shares to CVS and Walgreens. Rite Aid has stores in 19 US states and recently launched a “Store Of The Future,” which places the pharmacy near the entrance and brings pharmacists out from behind the counter for easier access.

Shoppers Drug Mart Corporation is a leading Canadian retail pharmacy chain based in Toronto, Ontario. It has more than 1,300 stores operating under the name Shoppers Drug Mart in nine provinces and two territories, and Pharmaprix in Quebec. The Jean Coutu Group Inc. is another Canadian drugstore chain headquartered in Varennes, Quebec with the parent company Metro Inc. The company operates over 400 franchised stores in Quebec, Ontario and New Brunswick, employing approximately 20,000 people.


Farm supply stores such as Tractor Supply Company (TSCO: NASDAQ), Farm and Fleet, Fleet Farm and C-A-L Ranch Stores have proven to be excellent growth machines. For example, Tractor Supply Company went from a small chain to having more than 1,875 units with excellent financial prospects. These stores not only cater to farms and ranches but also to suburban homeowners, with pet supplies, seed and lawn care products. They also sell clothing and other hardware supplies. TSC has been excellent with the rollout of Buy Online Pickup in Store (BOPIS) and their Ship to Store which has both increased overall sales and store facility utilization. 

A concern for triple net and single tenant net lease property investors owners is that these are larger sized stores located sometimes in sparsely populated areas. If the tenant does not renew, the property owner could have an issue replacing them at the current rental rate. Many times they do have a lower rental rate, which gives you options to replace these tenants with a supermarket, hardware or industrial tenant.


Fast Food restaurants, also known by the industry-preferred term Quick Service Restaurants (QSRs), continue to be in high demand for net lease real estate investors. Some of the most well-known worldwide brands among the top players include McDonald’s, Starbucks, KFC (Yum Brands – Chicken), Burger King, Wendy’s, Taco Bell (Yum Brands – Mexican), Chick-Fil-A (Chicken), White Castle, Nandos, Pizza Hut (Yum Brands), FatBurger, Whataburger, Jack In The Box, Arby’s, Hardy’s, Sonic, Autogrill SpA, Carl’s Jr. and Luckin Coffee.  Popeyes, Churches, Raising Cane’s, Zaxby’s, and Slim Chickens round out some of the other major chicken competitors. El Pollo Loco and Del Taco are leading Mexican chains as well as Jollibee, which originated for the Philippines. 

Drive-thru is the driving force in fast food. Industry estimates indicate that between 50–70% of US QSR sales are ordered and picked up at the locations’ drive-thru windows. Hamburger chains have higher average drive-thru orders with Mexican and Chicken QSRs right behind them. West Coast hot dog chain Wienerschnitzel averaged about 65–70% of sales as drive-thru before COVID, which now raised their drive-thru volume to around 90% at the same time as their sales increase of 22%! Dutch Bros. is a West Coast coffee phenomenon where drive-thru service is stacked 20 cars deep and the walk-up business line extends halfway around the block. 

Another industry trend has been 24-hour drive-thru service in urban areas and near Interstate highways. By making their units more productive around the clock, the QSR industry giants can gain a higher return and squeeze more revenue from their fixed asset costs of real estate and buildings. The McDonald’s franchisee Herb Petersen (inventor of the Egg McMuffin) figured out that by adding breakfast he could get an extra few hours of productivity and sales per day.  Breakfast is now around 40% of McDonald’s total sales.  

Having drive-thru ordering and pick-up services led to these companies to be able to operate during the pandemic, and having less competition from sit-down restaurants has led to their increased product demand from consumers.

Fast-casual restaurants, which were traditionally more walk-in/eat-in focused, are redesigning prototypes and relocating stores to add the drive-thru service. Chipotle, Habit Burger Grill (Yum Brands US & China), Noodles & Company, Shake Shack and Qdoba are all adding drive-thrus to new store designs and layouts.

With brands expanding to meet the needs of their customers, companies are also thinking creatively about new layouts, amenities and functionality. As we continue to see robust store growth from many QSR brands in 2021 and beyond, savvy investors will be well positioned to capitalize on a wave of newly constructed, high-quality assets with long-term leases in place, featuring the latest creative designs focused on efficient customer service.


While some grocery items have been migrating online, most shoppers have still wanted to see touch-and-feel produce, meats and other perishable items. Grocery stores and supermarkets are our daily-needs traffic generator and have been consistent performers. As discussed above, even Amazon has realized that many people want in-person grocery shopping. People want to touch, see and feel their food.  They want the “experience” of the smells, bells and human interaction. It is why farmers markets like Marché Saxe-Breteuil, Marrakech Souk, Targul de Craciun Bucharest and the Grand Bazaar still exist.

Though not considered a supermarket, Walmart stands as the nation’s largest food retailer, with an over $8 Billion increase in grocery sales comparing 2019 and 2020. The Kroger Co. (NYSE: KR), with 2,757+ supermarkets and grocery stores, generated sales of over $122 Billion in 2019. The grocer company has a Baa1 credit rating and operates the Kroger, Kroger Fuel Centers, Marianos, Pick N Save, Harris Teeter and Smiths banners.

Albertsons Companies, Inc. (NYSE: ACI) is another one of the largest US grocery chains, with $62 Billion of revenue in 2020 from its more than 2,500 stores, including Safeway, Albertsons and Vons grocery. The company also controls Jewel Osco, Amigos, United supermarkets and many more.

Ahold Delhaize generated more than $44 Billion in sales across its 2,000+ grocery stores in 23 states and operates under the banners Food Lion, Stop & Shop, Giant and Hannaford. Publix Super Markets Inc., with locations in Florida and 6 other southeast states, operates 1,264 stores that performed with $38.1 Billion in revenue in 2019.

As one of the few privately owned US grocery chains, H.E. Butt Grocery Co. has more than 340 store locations (mostly in Texas) that generated an estimated $28 Billion in revenue.

Meijer Inc. made over $20 Billion of revenue from its 248 store locations in Illinois, Indiana, Kentucky Michigan and Ohio. The company partially owns Fresh Thyme, a natural grocery chain that operates 74 stores primarily in the Midwest across 11  states. The retailer-owned Wakefern Food Corp. operates 354 supermarket stores under the banners ShopRite, Price Rite, The Fresh Grocer, Dearborn Market and Gourmet Garage, generating revenue of $16.6 Billion.

Whole Foods Market, owned by Amazon, is the world’s leading natural/organic grocer, with more than 500 store locations in the US and UK, estimating $16 Billion of revenue in 2020. Other popular organic grocery chains include Natural Grocers (NYSE: NGVC) with 159 locations, Sprouts Farmers Market (NASDAQ: SFM) operating more than 342 stores, and Trader Joe’s having 530 store locations in 42 states plus D.C.

Aldi is the leading discount grocer in the US, operating over 2,000 stores in 36 states and among the highest in customer preference. Lidl is another discount grocer; it is a European chain operated under family-owned multinational retail group The Schwarz Group, the largest European retailer and the fourth-largest retailer in the world by revenue — also operating under the Kaufland brands banner. The Lidl banner now resides on approximately 11,200 stores across 32 countries, with 100 locations in the US. Save a Lot is another growing US discount grocery chain, operating more than 1,300 stores in 36 states.

Regional retailers have proven to often be much better merchants while also producing higher store volumes per square foot. Leader in the industry include Wegmans, H.E.B., Hy-Vee and Publix. Cardenas is one of the largest regional Latino grocery chains in the country and is owned by KKR & Co. Inc. (NYSE: KKR), a Global Investment Firm that holds $150 Billion under the company’s asset management. The hispanic supermarket chain operates over 56+ stores located in Arizona, California and Nevada, generating more than $1 Billion in sales.

Online ordering, high-end grocers and discount grocery stores have been taking market share from large US grocery chains like Kroger and Albertsons LLC.


Home Depot, Lowes, Harbor Freight (tools) and Menards have had a record year in 2020, consolidating more of the home improvement, building materials and tool sales into their arsenal than ever before. The Home Depot, Inc. (NYSE: HD), or more commonly known as Home Depot, is the world’s largest home improvement chain and operates almost 2,300 stores across the US, Canada and Mexico. Home Depot generated $110.2 Billion in revenue from 2019, and increased its 2020 Q3 sales by 23.2% (an added $6.3 Billion) compared to the prior year. Lowe’s (NYSE: LOW), the second largest US home improvement company, has over 2,200 locations, serving approximately 18 million customers each week. The company had $72.1 Billion in sales for 2019, and grew Q3 sales in 2020 to $22.3 Billion, a 30.1% compared to 2019 relative quarter earnings ($17.4 Billion). Menards comes in as the third largest home improvement chain in the US concentrated in the Midwest across 14 states with about 350 stores. As one of America’s largest private companies, Menards has an estimated annual revenue of $10.7 Billion dollars and expects growth to come.


Medtail (medical/dental retail and service) has become an excellent investment option as a more prominent fixture in the US net lease real estate investment market and is expected to grow in 2021. Doctors, dentists and medical service providers have discovered the necessity of convenience and parking that retail shopping areas provide. Excellent credit tenants include the major dialysis service companies de Vita and Fresenius. Brand-name dental service organizations such as Aspen Dental, Heartland Dental, Pacific Dental and Western Dental not only have strong corporate backing in buying power but also have wealthy doctors as lease guarantors. 

Urgent care centers totaled 9,616 by the end of 2019, which is an increase of 9.6% compared to 2018 (according to Becker’s Hospital review February 2020). Trends, like urgent care visits increasing by 119% and emergency room visits decreasing by 36% between 2008 and 2015, indicate the increasing want for convenient, easily accessible non-emergency healthcare in the US.

With the coronavirus pandemic came an increase in the focus on the accessibility and convenience of retail healthcare, or Medtail, locations to provide quick, affordable medical options for consumers across the country that bolstered medical service providers’ sales significantly.

Another growing Medtail retail space includes the urgent care center, or “doc-in-the-box” office, that operates 24 hours daily with typically free emergency rooms. Some urgent care locations are owned buy larger hospital companies that have a strong backing with billions of dollars in assets. Since the medical service industry only recently started attracting a large amount of attention from investors, the Medtail service space is still fragmented that couldn’t quickly fall under the control of larger medical corporations or insurance companies seeking to control costs.

A risk factor to the expansion in the ongoing health of the industry could be a switch to socialize medicine in the US. Another outstanding investment opportunity that we put into the metal category is veterinarians. There are several excellent veterinary chains that are either publicly or privately traded like in the case of Mars Corporation — one of the largest private companies with billions of dollars in sales from the entire world.


Office supply stores have been a net lease staple for the past 20 years however they have been under huge pressure from Amazon and cannibalizing their own store sales with online or direct marketing sales. Although they have performed well during the 2020 pandemic we see them as a legacy business model and their current store sizes will more than likely if they continue operating be reduced.  Office Depot (NASDAQ: ODP) and Staples (taken private by private equity firm Sycamore Partners in 2017) are the two dominant office supply chains.


The pet store category has seen exponential growth over the past few years. Pet stores have been the beneficiary of the shifting demographics; many young adults have been putting off having children and, instead, opted for pets. Many pet stores have also added wash services, veterinary clinics and “bring your pet into the store” policies. The pet store business is still fragmented between large national tenants like Petsmart, Petco and smaller franchise-owned operations such as Pet Supplies Plus.

Petco Animal Supplies Inc., nicknamed Petco, is a leading US retail pet store that sells a variety of pet products and services plus some live animals. The company operates over 1,500 stores located across the US, Mexico and Puerto Rico, including more than 100 in-store veterinary clinics, and generated over $4.1 Billion in revenue from 2019 with definite growth in 2020 due to increased pet-related consumer spending during COVID-19. Petco aims to enter the Nasdaq stock exchange under the publicly traded symbol “WOOF” but has not yet determined how many shares it will offer due to its $3.3 Billion in outstanding debts. But, prospects are hopeful for the pet-friendly company with net sales rising 9% and a same-store sales growth of 9.6% compared to 2019.


The sporting goods and outdoors categories include DICK’S Sporting Goods (NYSE: DKS), Hibbett Sports (NYSE: HIBB) which operates under both the Hibbett banner and City Gear athletic clothing banners, Big 5 Sporting Goods and then the shoppertainment giants Bass Pro Shops (private company) which also operates Cabela’s and North Dakota based Sheels which operates 28 gigantic stores that include Ferris Wheels, a 16,000-gallon aquariums and ain. Though mandatory shutdowns due to COVID created temporary problems for the sporting goods industry, the market has projected steady growth over the next five years.

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Michael Flight was named the Godfather of Blockchain Real Estate by Forbes Crypto.  Michael achieved that distinction by co-founding Liberty Real Estate Fund, the World’s First Net Lease Security Token Fund, creating the Blockchain Real Estate Summit. More recently co-founding Invest On Main ( the Real Estate & Alternative Asset marketplace of the future and AcceleratedLaw a faster, cheaper way to create and tokenize securities offerings! 

Michael is a real estate entrepreneur and real estate tokenization pioneer who is an expert in retail real estate investment, redevelopment and real estate on the blockchain.  He started his commercial real estate career in 1985, and then co-founded Concordia Realty Corporation in 1990, which continues to partner with some of the world’s most well-known banks, insurance companies, hedge funds and institutional investors in many successful investments.

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*Note: Liberty Real Estate Fund LLC and Liberty Equity Management LLC (collectively have made every attempt to ensure the accuracy and reliability of the information provided. Liberty cannot not accept any responsibility or liability for the accuracy, content, completeness, legality, or reliability of the information contained herein. The information herein considered legally-binding legal advice, tax guidance, or financial counsel.

DISCLOSURES, LEGAL AND TAX COUNSEL: Liberty Real Estate Fund and Concordia Equity Partners LLC. (collectively “LibertyFund”) and their affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction or undertaking. LibertyFund highly encourages individuals and investors to seek the counsel of a qualified attorney as well as seek the counsel of a tax professional or Certified Public Accountant (CPA) to determine if there are any potential tax liabilities or consequences as the result of anything contained herein.  NO GUARANTEE: All users of this website should understand there are NO GUARANTEES of any success, outcome or profitability of any transaction or undertaking, expressed or implied by LibertyFund or any of its members, shareholders, officers or affiliates and will NOT be liable for any financial or other losses or damages incurred as a result of any undertaking. Go HERE to view complete DISCLOSURES.

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