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Shopping Strip

Advance Auto Parts | Aaron's Center

1841-1859 4th Street, Allentown, PA 18103

Listing Price: $5,004,738

Cap Rate
6.50%
Gross SF
22,325
Rentable SF
22,325
Price/Gross SF
$224.18
Lot Size
2.10 acres
Year Built
1956

Investment Overview

Marcus & Millichap, on behalf of ownership, is pleased to exclusively offer the fee simple interest in The 4th Street Shops, a 22,325-square-foot three-tenant strip center located in Allentown, Lehigh County, Pennsylvania (the “Offering”). The Offering presents a highly creditworthy tenant mix with a 16-year average occupancy, and a compounded NOI growth rate near 2% which will fend off inflationary pressures. Additionally, rental rates are at-market limiting an investor’s downside risk. The Offering’s leading tenants are Advance Auto Parts (NYSE:AAP) and Aaron’s Rental (NYSE: AAN), who together make up 68% of the rental revenue. Advance Auto Parts has operated here since 2011. After completion of its 10-year base term, the Tenant exercised a contract option in January 2022 without inducement, providing term through 2027. The Tenant is investment grade, rated “BBB-” by Standard and Poor’s. Geofencing data from Placer.ai indicates this store performs very well, ranking in the top 25 percent of stores statewide (45th of 188 stores). Advance Auto is joined by Aaron’s, Inc., whose lease commenced in 1997. The retailer has since exercised four tenant options demonstrating their long-term commitment to this location. Aaron’s has term through December 2027 with structured annual rental increases of $0.25-per-square-foot. Aaron’s reported annual revenue of $1.85 billion in 2021, an increase of 6.4% compared to 2020. The Company is rated “B2” by Creditntell, which equates to a Standard & Poor’s rating of “BBB+/-” The third tenant, Big Woody’s Sports Bar & Restaurant, occupies two suites totaling 7,050 square-feet. Big Woody’s has operated here since 2009 and has exercised two contract options. The Tenant has term through 2024 with two, five-year options remaining and structured rental increases. In-store management and ownership indicate this is one of the top locations for the tenant, so it is highly likely the tenant will renew. Big Woody’s has six locations throughout the Lehigh Valley, including three in Allentown. The restaurant and sports bar operates 365 days per year and is a popular barrestaurant destination for televised sporting events. It also offers outdoor seating and delivery until 1:30 am. The Offering occupies a prominent 2.10-acre parcel along the heavily traveled Route 145/South 4th Street retail corridor. Route 145 is the main north–south arterial into Allentown and averages 18,227 vehicles per day. The property has exceptional frontage and visibility with five means of access and 115 designated parking spaces. It is located three-tenths-of- a-mile from Mountainville Plaza, featuring 130,713 square-feet of retail anchored by Price Rite, Rite Aid and Dollar General, and is proximate to notable creditworthy retailers Walgreens, 7-Eleven, AutoZone, Wells Fargo, Dunkin’, CVS and more. The 4th Street Shops is well-located in a highly dense Allentown submarket with more than 18,133 people within a one-mile radius. Allentown is the fastest-growing major city in Pennsylvania, and the third largest in total population behind only Philadelphia and Pittsburgh. The county seat location has experienced considerable population growth over the past two decades. Since 2000, the three-and-five-mile populations have increased by 15% to 121,823 and 246,846 residents respectively. This location’s confluence of strong residential density and commercial drivers, enhanced by the area’s forecasted population growth, make this location highly desirable today, and into the future.

Investment Highlights

  • Low Management Three-Tenant Offering
  • 68 Percent of Revenues from Creditworthy Retailers Aaron's & Advance Auto Parts
  • Located Along Heavily Travelled Retail Corridor (18,227 VPD)

Exclusively Listed By

Broker of Record

  • Sean Beuche

    Vice President/Regional Manager

    (215) 531-7000

    License(s) PA: RM424190

    Pennsylvania

Shopping Strip

Advance Auto Parts | Aaron's Center

Listing Price: $5,004,738

Cap Rate
6.50%
Gross SF
22,325
Rentable SF
22,325
Price/Gross SF
$224.18
Lot Size
2.10 acres
Year Built
1956

Investment Highlights

  • Low Management Three-Tenant Offering
  • 68 Percent of Revenues from Creditworthy Retailers Aaron's & Advance Auto Parts
  • Located Along Heavily Travelled Retail Corridor (18,227 VPD)

Investment Overview

Marcus & Millichap, on behalf of ownership, is pleased to exclusively offer the fee simple interest in The 4th Street Shops, a 22,325-square-foot three-tenant strip center located in Allentown, Lehigh County, Pennsylvania (the “Offering”). The Offering presents a highly creditworthy tenant mix with a 16-year average occupancy, and a compounded NOI growth rate near 2% which will fend off inflationary pressures. Additionally, rental rates are at-market limiting an investor’s downside risk. The Offering’s leading tenants are Advance Auto Parts (NYSE:AAP) and Aaron’s Rental (NYSE: AAN), who together make up 68% of the rental revenue. Advance Auto Parts has operated here since 2011. After completion of its 10-year base term, the Tenant exercised a contract option in January 2022 without inducement, providing term through 2027. The Tenant is investment grade, rated “BBB-” by Standard and Poor’s. Geofencing data from Placer.ai indicates this store performs very well, ranking in the top 25 percent of stores statewide (45th of 188 stores). Advance Auto is joined by Aaron’s, Inc., whose lease commenced in 1997. The retailer has since exercised four tenant options demonstrating their long-term commitment to this location. Aaron’s has term through December 2027 with structured annual rental increases of $0.25-per-square-foot. Aaron’s reported annual revenue of $1.85 billion in 2021, an increase of 6.4% compared to 2020. The Company is rated “B2” by Creditntell, which equates to a Standard & Poor’s rating of “BBB+/-” The third tenant, Big Woody’s Sports Bar & Restaurant, occupies two suites totaling 7,050 square-feet. Big Woody’s has operated here since 2009 and has exercised two contract options. The Tenant has term through 2024 with two, five-year options remaining and structured rental increases. In-store management and ownership indicate this is one of the top locations for the tenant, so it is highly likely the tenant will renew. Big Woody’s has six locations throughout the Lehigh Valley, including three in Allentown. The restaurant and sports bar operates 365 days per year and is a popular barrestaurant destination for televised sporting events. It also offers outdoor seating and delivery until 1:30 am. The Offering occupies a prominent 2.10-acre parcel along the heavily traveled Route 145/South 4th Street retail corridor. Route 145 is the main north–south arterial into Allentown and averages 18,227 vehicles per day. The property has exceptional frontage and visibility with five means of access and 115 designated parking spaces. It is located three-tenths-of- a-mile from Mountainville Plaza, featuring 130,713 square-feet of retail anchored by Price Rite, Rite Aid and Dollar General, and is proximate to notable creditworthy retailers Walgreens, 7-Eleven, AutoZone, Wells Fargo, Dunkin’, CVS and more. The 4th Street Shops is well-located in a highly dense Allentown submarket with more than 18,133 people within a one-mile radius. Allentown is the fastest-growing major city in Pennsylvania, and the third largest in total population behind only Philadelphia and Pittsburgh. The county seat location has experienced considerable population growth over the past two decades. Since 2000, the three-and-five-mile populations have increased by 15% to 121,823 and 246,846 residents respectively. This location’s confluence of strong residential density and commercial drivers, enhanced by the area’s forecasted population growth, make this location highly desirable today, and into the future.

Exclusively Listed By

Broker of Record

  • Sean Beuche

    Vice President/Regional Manager

    (215) 531-7000

    License(s): PA: RM424190

    Pennsylvania

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