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It appears that some brands like Dollar General, Burger King, and Advance Auto Parts have been making lots of deals. Is it because of the nature of their businesses, or is it because of location?
It’s both. These companies are big nationwide chains, and they’re also real estate developers. They’re expanding. Dollar General has been adding 800 to 1,000 units a year for the last decade. QSRs like Burger King and auto parts chains have done well heading into the COVID crisis and are still doing well. There are companies that have been hoarding cash and see this as a good time to acquire great locations. If I’m a five-unit Taco Bell franchisee who’s got cash and is able to buy, maybe three years from now I’ve got 40 units. If you have the capital, this is an opportunistic time to grow.
Has your national sale-leaseback team been especially busy during the pandemic?
Most definitely. Since March, we've closed on 17 sales spanning the QSR, grocery, automotive, convenience store, dollar store, medical, and drug store sectors—and that included medical-use cannabis. There are investors out there looking for real estate and pricing is aggressive. The pandemic has caused a lot of distress, but it’s not distressed pricing in commercial real estate.