Broadstone Net Lease acquires freestanding, single-tenant properties net-leased to credit worthy tenants and brands. The portfolio uses conservative leverage and is constructed of long-term leases with contractual rent increases to help withstand economic volatility.
Why net-leased properties?
- High return relative to risk level assumed
- Predictable returns due to tenant responsibilities and long term leases
- Opportunity for growth in cash flow and valuation attributable to contractual rent increases
- Ability to access favorable debt financing due to predictable cash flows
- Growth in rent and ownership of real assets helps to hedge against inflation
- Still a very fragmented industry and imperfect market, with opportunities for astute buyers
- Opportunity to add value at time of acquisition through proper negotiation and underwriting
How we generate return and minimize risk:
- Review and underwrite billions of dollars of deals
- Study and monitor numerous industries and brands
- Underwriting methodology: we seek developed properties with credit worthy (not necessarily credit rated) tenants demonstrating significant rent coverage while still stressing real estate fundamentals
- Diversify by industry, geography and tenant with a focus on recession resistant businesses (e.g., fast food, medical offices)
- Negotiate long-term leases augmented with personal guarantees or other credit enhancements as necessary
- Disciplined hold/sell analysis performed regularly for every property.