Walmart TENANT OVERVIEW


Net Lease Advisor Tenant Walmart

Pros

  • Corporate guaranteed, investment grade tenant
  • High visibility virtually creating a new downtown wherever it opens
  • Typically low rent per square foot
  • Low recourse and low interest rates often available

Cons

  • Flat rental rates, minimal escalations.
  • Large footprint poses re-lease challenges should tenant relocate

Earnings Highlights

Earnings Summary
  • Walmart U.S. Q3 comp sales grew 3.4%
  • Walmart U.S. eCommerce sales grew 43%
  • Total revenue was $124.9 Billion, an increase of $1.7 Billion, or 1.4%

Tenant Description

Walmart is the largest retailer in the world.

Walmart has a few store types, each with their own characteristics. On the large end, the Walmart Supercenters have the widest range of items stocked, as well as a full supermarket. These supercenters are typically 182,000 square feet. On the small end, the Walmart Neighborhood Market concept. These are a smaller-footprint option, 38,000 square feet, and contain a pharmacy, groceries, and some merchandise. In the middle is the Walmart Discount Store, which are typically 106,000 square feet.

Walmart stores are rare investments on the net lease market with the transaction size, acreage, and square footage of the investment (much larger on all counts than the typical net lease property) appealing to a more select group of investors. High annual rents and relatively low cap rates means the typical net lease Walmart transaction is over $10 M.

Walmart Stores, Inc. (NYSE: WMT) is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company was Fortune’s largest public corporation in 2018 by revenue, $500.3 B.

Walmart was founded by Sam Walton in 1962, incorporated on October 31, 1969, and publicly traded on the New York Stock Exchange in 1972. Headquartered in Bentonville, Arkansas, it is the largest majority private employer. Walmart is also the largest grocery retailer in the United States. It also owns and operates the Sam's Club retail warehouses in North America. Walmart serves nearly 265 million customer each week from their more than 11,200 stores under 55 banners in 27 countries.

Average Cap Rate
5.44%
12 mo avg with 10+ yr lease term
Average Property & Lease
Average Sale Price $11,441,125
NOI $622,397
$/Square Foot $60 - $300
Building SF 38,000 - 182,000
Lot Size Varies Greatly
Lease Term 20 Year
Escalations 5 - 10% at Renewal Options
Stock Symbol WMT
Credit Rating
S&P AA
Moody's Aa2
Average Cap Rate Trend
5.52%
2017
5.84%
2018
Rates reflect last 12 mos, short and long-term
Recent Sales Comps
Palm Desert, CA 5.00%
Tell City, IN 6.64%
Kansas City, MO 5.75%