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Shopping Strip

Drive-Thru Starbucks Anchored Retail Center

5505 S Kedzie Ave, Chicago, IL 60629

Listing Price: $7,340,000

Cap Rate
6.75%
Gross SF
14,812
Rentable SF
14,812
Price/Gross SF
$495.54
Lot Size
1.21 acres
Year Built
2018

Investment Overview

Marcus & Millichap is pleased to present the opportunity to purchase the fee simple interest in 5505 S Kedzie Avenue, a Drive-Thru Starbucks Anchored Retail Center located at the signalized intersection of Kedzie and 55th Street in Chicago, IL. This urban infill location benefits from visibility to over 34,000 cars per day, multiple points of ingress and egress and easy access to its parking field – a rare amenity for a shopping center located in the city of Chicago. The GLA is comprised of approximately 50% medical tenants, all of whom operate on strong NNN leases with significant corporate and/or personal guaranties. The tenants all have approximately 7 or more years of lease term remaining. The opportunity is offered at a 6.75% CAP rate, with a leveraged cash on cash return (utilizing currently available debt) of 7.71%. Within the second year of a new owner's hold period (by April of 2023), the majority of tenants' rents will increase significantly, due to built-in rent bumps every 5 years, per their leases. This will increase the in place cap rate to 7.02%, and the cash on cash return will jump to 8.64%. The tenant mix is highly synergistic and with so much of the tenancy offering various medical services, the longevity of the tenant base is built to serve the evolving needs of the surrounding community as retail continues to progress.

Investment Highlights

  • 7.71% cash on cash return at list price | Significant rent increases coming in 1.5 years (March of 2023) | Those rent bumps will push a new owner's cash on cash return to 8.64%
  • Dense, urban infill location in the city of Chicago at the signalized intersection of Kedzie and 55th Street | Average daily traffic counts of +34,000 | 315,000 people live within a 3 mile radius
  • Anchored by a busy drive-thru Starbucks with limited competition (nearest Starbucks is 2.6 miles away) | Highly stable rent roll with at least 7 years remaining on all the leases
  • 50% of the GLA is leased to medical tenants, diversifying the retail use of the property and increasing the related synergies between tenants
  • Across the street from a 24-hour Walgreens and adjacent to a 43,000 square foot LA Fitness
  • Class A masonry construction

Exclusively Listed By

Financing By

Shopping Strip

Drive-Thru Starbucks Anchored Retail Center

Listing Price: $7,340,000

Cap Rate
6.75%
Gross SF
14,812
Rentable SF
14,812
Price/Gross SF
$495.54
Lot Size
1.21 acres
Year Built
2018

Investment Highlights

  • 7.71% cash on cash return at list price | Significant rent increases coming in 1.5 years (March of 2023) | Those rent bumps will push a new owner's cash on cash return to 8.64%
  • Dense, urban infill location in the city of Chicago at the signalized intersection of Kedzie and 55th Street | Average daily traffic counts of +34,000 | 315,000 people live within a 3 mile radius
  • Anchored by a busy drive-thru Starbucks with limited competition (nearest Starbucks is 2.6 miles away) | Highly stable rent roll with at least 7 years remaining on all the leases
  • 50% of the GLA is leased to medical tenants, diversifying the retail use of the property and increasing the related synergies between tenants
  • Across the street from a 24-hour Walgreens and adjacent to a 43,000 square foot LA Fitness
  • Class A masonry construction

Investment Overview

Marcus & Millichap is pleased to present the opportunity to purchase the fee simple interest in 5505 S Kedzie Avenue, a Drive-Thru Starbucks Anchored Retail Center located at the signalized intersection of Kedzie and 55th Street in Chicago, IL. This urban infill location benefits from visibility to over 34,000 cars per day, multiple points of ingress and egress and easy access to its parking field – a rare amenity for a shopping center located in the city of Chicago. The GLA is comprised of approximately 50% medical tenants, all of whom operate on strong NNN leases with significant corporate and/or personal guaranties. The tenants all have approximately 7 or more years of lease term remaining. The opportunity is offered at a 6.75% CAP rate, with a leveraged cash on cash return (utilizing currently available debt) of 7.71%. Within the second year of a new owner's hold period (by April of 2023), the majority of tenants' rents will increase significantly, due to built-in rent bumps every 5 years, per their leases. This will increase the in place cap rate to 7.02%, and the cash on cash return will jump to 8.64%. The tenant mix is highly synergistic and with so much of the tenancy offering various medical services, the longevity of the tenant base is built to serve the evolving needs of the surrounding community as retail continues to progress.

Exclusively Listed By

Financing By

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