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  Kohl's


Average Property & Lease

Average Sale Price$11,769,816
CAP Rate (12mo avg with 10+ lease term)6.31%
NOI$733,709
$/Square Foot$116
Building Size50,000 - 100,000 sf
Lot Size5 - 10 acres
Lease Term20+ years
EscalationsIn Option Periods
CREDIT RATING
BBB
S&P
Baa2
Moody's
view credit rating chart
View Net Lease Property Listings at CALKAIN.COM Last Updated: September 26, 2016
Net Lease Advisor Overview

From a net lease investor standpoint, Kohl's offers a credit tenant backed guarantee with long term leases (often ground leases) and rent increases. Although Kohl's is a department store - in the same category as J.C. Penny - most of their locations are free-standing. Currently, Kohl's operates stores in every U.S. State but Hawaii.

As a retailer, Kohl's claims to offer "Off-mall" convenience and a combination of specialty and national brands for their customers. Kohl's also is active in remodeling their stores and states that 50% of their stores are either new or remodeled in the past 5 years. As of 2013, Kohl's leases approximately 65% of their stores while owning 35%. As of February 2013, Kohl's was rated as America's second favorite retail chain by Market Force Information and #1 in "Customer Loyalty Engagement Index" by Brand Keys.

Pros

Cons

  • Lease usually includes increases
  • Investment grade credit tenant
  • Corporate Guarantees
  • Long term leases
  • High price point
  • Due to size, harder to lease property if the tenant leaves
  • Current trends point away from large scale retail stores
Tenant Description

Kohl's Corporation is an American department store chain headquartered in the Milwaukee suburb of Menomonee Falls, Wisconsin, operating 1,158 stores in 49 states. Kohl's stores feature nationally recognized brand-name merchandise, exclusive labels, and private-branded goods, virtually the same merchandise mix as traditional department stores. The stores sell a variety of goods, such as apparel, shoes, and accessories for women, children and men, and home products such as small electronics, kitchen electrics, electric shavers, toothbrushes, vacuum cleaners & floor care, bedding, toys, and luggage.

Although some locations are in enclosed shopping malls, the majority of stores are free-standing. Kohl's operates differently from traditional department stores, like Macy's or JCPenney. The most noticeable distinction is that Kohl's stores have centralized check-out aisles much like grocery stores, where a single line is used for check-outs. Kohl's also uses a "racetrack" aisle that circles the entire store, a technique borrowed from discount stores but rarely used in department stores.


KOHL'S TREND
CAP Rate

2014 avg: 6.61%

2015 avg: 6.03%

RECENT SALES

Maricopa, AZ

$29,500,000 | 6.55%

Los Angeles, CA

$10,600,000 | 5.26%

MORE INFO
www.kohls.com
Google Finance: KSS
Google News: KSS