A prominent retail property housing a drive-thru Starbucks on Route 17 in Paramus, New Jersey, has been sold in a recent transaction. The deal signals sustained investor confidence in prime commercial real estate within the state's most competitive retail markets.
The property, located at 177 Route 17 South, was acquired by O & J Properties from the seller, R.G. Kenlin Co. The transaction highlights the continued appeal of single-tenant properties with strong national brands, particularly in high-traffic corridors.
Key Takeaways
- A drive-thru Starbucks location at 177 Route 17 South in Paramus has been sold.
- The seller was R.G. Kenlin Co., and the buyer was O & J Properties.
- The Goldstein Group brokered the deal, representing both parties involved in the transaction.
- Experts note the sale reflects strong investor demand for well-located retail assets with reliable tenants in premier New Jersey markets.
Details of the Commercial Transaction
The sale involved the physical site and building that is currently leased to Starbucks. The transaction was managed by The Goldstein Group, a commercial real estate brokerage firm. Representing both the seller and the buyer were brokers Lew Finkelstein, CJ Huter, and Marc Palestina, who facilitated the investment property sale.
While the financial terms of the deal were not disclosed, such sales often reflect the value of the long-term lease agreement with the tenant in addition to the property's intrinsic real estate value. Properties occupied by major corporate brands like Starbucks are frequently sought after by investors for their stable income streams and lower perceived risk.
What is a Single-Tenant Net Lease?
Many commercial properties like this Starbucks are sold as 'net lease' investments. In this structure, the tenant (Starbucks) is responsible for paying many of the property expenses, such as taxes, insurance, and maintenance, in addition to rent. This arrangement provides a more predictable, hands-off income stream for the property owner, making it an attractive asset class for investors.
Investor Confidence in Prime New Jersey Retail
The acquisition underscores a broader trend of investor appetite for high-quality retail locations, even as the sector faces evolving consumer habits. According to industry leaders, the key is location and tenant quality.
“The sale of 177 Route 17 South underscores the continued investor demand for well-located retail assets in premier New Jersey markets,” stated Neil Goldstein of The Goldstein Group.
Goldstein's comments suggest that the market for commercial properties in top-tier locations remains robust. Investors are actively seeking assets that can weather economic fluctuations, and a drive-thru location for a global coffee chain on a major highway fits that profile perfectly.
These properties are valued for their long-term market fundamentals, including consistent consumer traffic and the proven performance of established tenants.
The Strategic Importance of the Paramus Retail Corridor
Paramus, particularly the stretch of Route 17 where the property is located, is one of the most significant retail hubs in the United States. Its unique combination of high-density population, affluent demographics, and extraordinary traffic counts makes it a coveted location for both retailers and real estate investors.
Why Paramus Attracts Investment
- Unparalleled Traffic Counts: Route 17 is a major north-south artery in Bergen County, carrying tens of thousands of vehicles daily, providing immense visibility and accessibility for businesses.
- Strong Tenant Performance: Retailers in Paramus consistently report high sales volumes, making it a profitable location that reduces the risk of tenant turnover.
- Retail Density: The corridor is home to numerous shopping centers, malls, and standalone big-box stores, creating a powerful synergy that draws shoppers from across the New York metropolitan area.
Paramus is often cited as one of the top retail zip codes in the country based on annual sales volume. This is achieved despite local "blue laws" that prohibit most retail businesses from opening on Sundays, concentrating a week's worth of shopping into six days.
The sale of the Starbucks site is not just a simple property transfer; it is a reaffirmation of the Paramus retail market's strength. For investors like O & J Properties, acquiring a piece of this corridor represents a strategic investment in a location with a proven track record of success and a stable outlook for future growth.
