ALDI TENANT OVERVIEW


Net Lease Advisory Tenant Aldi

Pros

  • Long term leases
  • Leases generally include rent increases every 5 years
  • Multiple extension of 5 years each

Cons

  • Private company
  • Competition from Lidl

Tenant Description

ALDI is a discount supermarket chain focusing on creating an efficient supermarket experience, saving customers time and money without sacrificing quality.

Although ALDI is a private company, there is great demand for their freestanding stores as net lease investments. The properties are well located on main commercial thoroughfares. ALDI net lease properties provide a long-term investment with no property management responsibilities in the form of 15 to 20-year primary term, NNN ground leases. The lease terms typically call for a 5% increases in rent every 5 years.

Founded by the Albrecht family, the first ALDI store opened in 1961 in Germany, making ALDI the first discounter in the world. Headquartered in Batavia, Illinois, ALDI has more than 1,600 stores across 35 states, employs over 24,000 people and has been steadily growing since opening its first US store in Iowa in 1976. The latest 500 stores it has opened have been in large suburban retail centers in middle-income or higher neighborhoods.

ALDI has a unique grocery shopping experience as the products are displayed in their shipping boxes to help save time and resources restocking shelves. Shoppers will find more than 90 percent of the groceries they offer are under the ALDI exclusive brands at the lowest prices.

And with more demand comes more stores. Over the past decade, ALDI has nearly doubled in size. By 2018, ALDI will bring its total number of US stores to nearly 2,000 - opening their doors to 650 new locations, including Southern California.

Average Cap Rate
5.59%
12 mo avg with 10+ yr lease term
Average Property & Lease
Average Sale Price $4,040,884
NOI $210,325
$/Square Foot $200 - $300
Building SF 17,000 - 25,000
Lot Size 2 - 3 Acres
Lease Term 15 - 20 Years
Escalations Varies
Stock Symbol N/A
Credit Rating
S&P N/A
Moody's N/A
Average Cap Rate Trend
4.96%
2015
5.49%
2016
Rates reflect last 12 mos, short and long-term
Recent Sales Comps
Palmdale, CA 4.02%
Milledgeville, GA 6.75%