Tyler retail building leased to Academy hits market for $13.5M
Katy-based chain has five years left on its lease
A retail building in Tyler leased by Academy Sports + Outdoors has hit the market.
The 87,000-square-foot, single-tenant store, at 8668 South Broadway Avenue, is about an hour and a half east of Dallas. Built in 2008, the property was listed by JLL for $13.5 million, or $155 per square foot. The property’s net operating income is $944,000, putting the cap rate at 7 percent. The owner is Galveston-based Three R Trusts.
JLL’s Caroline Pinkston is the broker on the listing. JLL bills the property as a “rare opportunity” that provides for “secure, long-term cash flow.”
The Tyler store is ranked fourth in the country for the retailer in terms of performance. Katy-based Academy has five-and-a-half years left on its 20-year triple net lease, with four- and five-year renewal options. The lease also includes 1.5 percent annual rent increases.
The property is adjacent to Tyler’s largest shopping center, the Village at Cumberland Park. The center’s tenants include T.J. Maxx, World Market, Burlington Coat Factory, Starbucks and Five Below. The center gets an estimated 3 million visitors each year, according to Placer.ai. In addition, South Broadway Avenue is exposed to more than 43,000 vehicles per day, according to the listing. In a one-mile radius around the property, the average household income is $141,000.
Retail centers are considered relatively safe investments amid increased turbulence for Texas’ office and multifamily markets. But there’s been almost no new supply built in the last decade. With construction costs still high and availability at an all-time low, rents are stronger than ever in the sector.
At the end of the third quarter, retail vacancy stood at 3.2 percent in Austin; 3.9 percent in San Antonio; 4.7 percent in Dallas-Fort Worth; and 5.1 percent in Houston, according to Partners Real Estate.