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7-Eleven
Advance Auto Parts
Affordable Dentures
ALDI
Applebee's
Arby's
Ashley Furniture
AutoZone
Bank of America
BankUnited
BB&T Bank
Best Buy
BMO Harris Bank
Bojangles'
Burger King
Captain D's
Chase Bank
Chick-fil-A
Chipotle
Church's Chicken
Circle K
Cracker Barrel
CVS
Dairy Queen
DaVita
Dollar General
Dollar Tree
Dunkin' Donuts
Family Dollar
FedEx
Fred's Super Dollar
Fresenius Medical Care
Hardee's
Hobby Lobby
IHOP
KFC
Kohl's
Mattress Firm
McDonald's
Napa Auto Parts
O'Reilly Auto Parts
Panera Bread
PDQ
Pep Boys Auto
PNC Bank
Red Lobster
Rite Aid
Sheetz
Shell Oil
Sherwin-Williams
Starbucks
Steak 'n Shake
SunTrust
Taco Bell
TD Bank
Tractor Supply Co.
Verizon
Walgreens
Walmart
Wawa
Wegmans
Wendy's
Zaxby's
  Bank of America


Average Property & Lease

Average Sale Price$5,343,897
CAP Rate (12mo avg with 10+ lease term)4.55%
NOI$244,006
$/Square Foot$500 - $1,200
Building Size3,000 - 6,500 sf
Lot Size1.00 acres
Lease Term15 - 20 Years
Escalations10-12% Every 5 Years
CREDIT RATING
A
S&P
A1
Moody's
view credit rating chart
View Net Lease Property Listings at CALKAIN.COM Last Updated: September 26, 2016
Net Lease Advisor Overview

Bank of America, (NYSE: BAC) did not emerge unscathed from the banking crisis and great recession but the strength of its deposits and dominance in market share along with its highly visible locations in both urban and suburban settings have helped Bank of America hold the interest of net lease investors. Generally, Bank of America sites are 1.00 - 1.5 acres with improvements of 3,500 to 4,800 square feet and are sold as unsubordinated ground leases* to NNN investors.

*In a ground lease, the investor/landlord owns the ground and the tenant constructs the building at costs of arround $1.3mm and retains ownership of the building until lease termination. The tenant leases the ground from the investor/landlord and on the tenant's default or other termination of the lease; the building becomes the property of the investor/landlord. Ground leases are extremely passive investments and generally sell at 50 to 125 basis points below the average cap rate for NNN "fee simple" ownership of ground and structure transactions leased by the same tenant.

The Bank of America ground lease is attractive to investors because they typically have an initial term of 15 to 20 years with up to five, five year renewal options. In addition, the Bank of America ground lease provides rent increases of 10-15% every five years.
 

Pros

Cons

  • Investment Grade tenant
  • Leases afford rental increases throughout the primary term, many with annual rental increases
  • Generally well located, either as out parcel to grocery anchored shopping center
  • Many locations are occupied as fee simple leases, allowing for depreciation versus the preferred ground lease scenario of most other bank brands
  • Retail banking industry outlook on necessity of physical locations is evolving
  • When located as a part of a shopping center, some use restrictions may apply
Tenant Description

Bank of America Corporation is an American multinational banking and financial services corporation headquartered in Charlotte, North Carolina. It is the second-largest bank holding company in the United States by assets. Bank of America has a relationship with 99% of the U.S. Fortune 500 companies and 83% of the Fortune Global 500. The company is a member of the Federal Deposit Insurance Corporation (FDIC) and a component of both the S&P 500 Index and the Dow Jones Industrial Average.

Bank of America services clients in over 150 countries with operations based in 40 countries. It provides services ranging from investment and corporate banking to investing and equity execution services. In the United States, Bank of America serves over 57 million customers and small businesses, operates around 5,700 retail banking offices and approximately 17,250 ATMs. It also has 30 million active users of their online banking.


BANK OF AMERICA TREND
CAP Rate

2014 avg: 5.15%

2015 avg: 5.29%

RECENT SALES

Smyrna, TN

$2,400,000 | 6.24%

Woodbury, NY

$9,000,000 | 5.3%

MORE INFO
www.bankofamerica.com
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