Former IHOP Restaurant
For Sale
Contact for pricing
1277 East Shelby Drive, Memphis, TN 38116
Former IHOP with multiple access points and strong corridor visibility for restaurant or retail redevelopment.
Property Size4,022 SF
Price / SF$298.36
Days on Market58
Property Features for 1277 East Shelby Drive
General Information
Standard status
Active
Size
4,022 SF
Property subtype
Retail, Land, Special Purpose
Additional Details
Traffic Count
25,800 vehicles/day
Building Details
Year Built
2002
Listing Agency:
Greysteel Company LLC
Listed By:
Nate Cleland · License #RS304039
Source:
Crexi
Added: Jun 10
Changed: Jul 10
Last Checked: Aug 6 at 12:06PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Greysteel Company LLC
Investment Insights
Based on property information with market context.
The property is a well-constructed, former IHOP restaurant building totaling 4,000+ square feet. The site is designed for retail use with excellent visibility and multiple access points to support straightforward customer ingress and egress.
The building is located on an outparcel along a high-traffic commercial corridor in Memphis, offering exposure to more than 25,800 vehicles per day. The property sits to the Southland Mall area and is surrounded by active retail, including national tenants such as Foot Locker, Popeyes, AutoZone, and Starbucks.
For investors and owner-users, the asset is positioned for repositioning or redevelopment, depending on the next concept planned for the space. The combination of strong vehicular exposure, prominent corridor presence, and multiple access points can support a range of restaurant or retail formats that benefit from drive-by traffic and convenient site access.
The building is located on an outparcel along a high-traffic commercial corridor in Memphis, offering exposure to more than 25,800 vehicles per day. The property sits to the Southland Mall area and is surrounded by active retail, including national tenants such as Foot Locker, Popeyes, AutoZone, and Starbucks.
For investors and owner-users, the asset is positioned for repositioning or redevelopment, depending on the next concept planned for the space. The combination of strong vehicular exposure, prominent corridor presence, and multiple access points can support a range of restaurant or retail formats that benefit from drive-by traffic and convenient site access.
Key Highlights
- Former IHOP built in 2002, 4,000+ SF retail building
- Located on E. Shelby Drive in a high‑traffic commercial corridor in Memphis
- Exposure to more than 25,800 vehicles per day with strong visibility
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$59,546
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
4.96%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,190,920
$1.2M
Cap Rate 7%
$850,657
$850.7K
Cap Rate 9%
$661,622
$661.6K
Market Conditions
NOI Build-Up for 4,022 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$84.5K $21.00/SF
− Vacancy
−$5.1K −$1.26/SF
EGI
$79.4K $19.74/SF
− OpEx
−$19.8K −$4.94/SF
NOI
$59.5K $14.81/SF
Area
ZIP 38116
Vacancy
6.00%
Lease Rate
$21.00 /SF/Yr
Expense Ratio
25.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,190,920
Cap Rate 7%
$850,657
Cap Rate 9%
$661,622
Alternative Uses
Best Use
Specialty Retail
$850.7K
$744.3K – $992.4K
NOI $59,546 @ 7.0% cap · market cap 4.96%
Second Best
Retail
$673.3K
$589.1K – $785.5K
NOI $47,130 @ 7.0% cap · market cap 3.93%
Theoretical Best
Office A
$986.7K
$863.4K – $1.15M
NOI $69,068 @ 7.0% cap · market cap 5.76%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Lease Details
25,800 VPD
Traffic count
Location Intelligence
Trade Area within ½ mile
330
Businesses Nearby
97k
Monthly Visits Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Foot Traffic Nearby
Shops & Services 56%
Dining 44%
McDonald's
Dining
28,753 visits/mo
0.3 miles
Burger King
Dining
13,386 visits/mo
0.3 miles
Family Dollar
Shops & Services
9,942 visits/mo
0.3 miles
Marathon
Shops & Services
9,434 visits/mo
0.3 miles
Dollar General
Shops & Services
8,766 visits/mo
0.3 miles
Demographics for 38116, TN
39,107
Population
18,526
Households
2.1
Avg Household Size
35
Median Age
21%
College-Educated
88%
High-School Grad
19.6 sq mi
ZIP Area
1,995
Density / Sq Mi
$44,663
Median Household Income
$31,593
Median Earnings
$1,035
Median Rent
$125,800
Median Home Value
Market
Vacancy Rate% for Retail in Memphis, TN
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Breakfast & diner - Former IHOP with multiple access points and strong corridor visibility for restaurant or retail redevelopment.
Where is this breakfast & diner located?
The property is located at 1277 East Shelby Drive Memphis, TN.
What is the asking price?
The asking price for this property is $1,200,000.
What are key features of this property?
This property features: Former IHOP built in 2002, 4,000+ SF retail building; Located on E. Shelby Drive in a high‑traffic commercial corridor in Memphis; Exposure to more than 25,800 vehicles per day with strong visibility
