Walgreens NNN Ground
For Sale
Contact for pricing
1863 UNION AVE, Memphis, TN 38104
Corporate-guaranteed NNN ground lease with approximately 49 years remaining through 2074.
Property Size13,963 SF
Lot Size2.29 Acres
Price / SF$340.90
Days on Market84
Property Features for 1863 UNION AVE
General Information
Standard status
Active
Size
13,963 SF
Lot size
2.29 Acres
Property subtype
Retail
Zoning
CMU-3
Occupancy
100%
Lease Type
Absolute Net
Investment Type
Net Lease
Net Operating Income
$309,480
Additional Details
Cap Rate
6%
Building Details
Year Built
1995
Stories
1
Units
1
Tenancy
Single
Listing Agency:
Marcus & Millichap - Seattle
Listed By:
Hank Wolfer · License #WA 110547
Source:
Crexi
Added: Jun 16
Changed: Sep 4
Last Checked: Sep 7 at 8:46AM
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 Marcus & Millichap - Seattle
Investment Insights
Based on property information with market context.
The offering consists of a 13,963-square-foot Walgreens on a 2.29-acre parcel. The property is leased under a corporate-guaranteed NNN ground lease with approximately 49 years remaining through September 2074.
The site is located at 1863 Union Avenue in Memphis, Tennessee, along the Union Avenue corridor.
Under the lease structure, Walgreens is responsible for property expenses, maintenance, repairs, taxes, and insurance, supporting a passive ownership profile for investors seeking long-term tenant-backed obligations.
The site is located at 1863 Union Avenue in Memphis, Tennessee, along the Union Avenue corridor.
Under the lease structure, Walgreens is responsible for property expenses, maintenance, repairs, taxes, and insurance, supporting a passive ownership profile for investors seeking long-term tenant-backed obligations.
Key Highlights
- 13,963 SF Walgreens on a 2.29‑acre parcel at 1863 Union Avenue, Memphis, TN
- Corporate‑guaranteed NNN ground lease with approximately 49 years remaining through September 2074
- Walgreens (tenant) responsible for all property expenses, maintenance, repairs, taxes, and insurance
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
$168,017
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
3.53%
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%
$3,360,340
$3.4M
Cap Rate 7%
$2,400,243
$2.4M
Cap Rate 9%
$1,866,856
$1.9M
Market Conditions
NOI Build-Up for 13,963 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
$234.6K $16.80/SF
− Vacancy
−$10.6K −$0.76/SF
EGI
$224.0K $16.04/SF
− OpEx
−$56.0K −$4.01/SF
NOI
$168.0K $12.03/SF
Area
Memphis, TN
Vacancy
4.50%
Lease Rate
$16.80 /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%
$3,360,340
Cap Rate 7%
$2,400,243
Cap Rate 9%
$1,866,856
Alternative Uses
Best Use
Specialty Retail
$2.40M
$2.10M – $2.80M
NOI $168,017 @ 7.0% cap · market cap 3.53%
Second Best
Retail
$1.99M
$1.74M – $2.32M
NOI $139,281 @ 7.0% cap · market cap 2.93%
Theoretical Best
Office A
$4.13M
$3.61M – $4.81M
NOI $288,867 @ 7.0% cap · market cap 6.07%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
1,606
Businesses Nearby
340k
Monthly Visits Nearby
Well-served
Demand for This Use
Explore this area
Business Placement
Foot Traffic Nearby
Dining 60%
Groceries 21%
Shops & Services 15%
Apparel 2%
Kroger
Groceries
70,178 visits/mo
0.3 miles
Chick-fil-A
Dining
55,414 visits/mo
0.2 miles
McDonald's
Dining
25,061 visits/mo
0.4 miles
Starbucks
Dining
14,400 visits/mo
0.0 miles
7 Brew Coffee
Dining
14,264 visits/mo
0.5 miles
Demographics for 38104, TN
22,584
Population
14,315
Households
1.6
Avg Household Size
38
Median Age
52%
College-Educated
93%
High-School Grad
5.0 sq mi
ZIP Area
4,517
Density / Sq Mi
$56,452
Median Household Income
$48,300
Median Earnings
$1,073
Median Rent
$301,100
Median Home Value
Market
Vacancy Rate% for Retail in Memphis, TN
Questions? Ask Rey
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Similar Off Market Nearby
- CVS Pharmacy — 2115 Union Ave, Memphis, TN 38104
- Ron L. Williams, DPH — 2145 Union Ave #110, Memphis, TN 38104
- CVS — 2115 Union Ave, Memphis, TN 38104
- Yolanda Tyson — 2145 Union Ave, Memphis, TN 381044206
- Dawn R. Wilburn-Goo, Pharm — 2145 Union Ave, Memphis, TN 38104
Frequently Asked Questions
What type of property is this?
Drug store - Corporate-guaranteed NNN ground lease with approximately 49 years remaining through 2074.
Where is this drug store located?
The property is located at 1863 UNION AVE Memphis, TN.
What is the asking price?
The asking price for this property is $4,760,000.
What are key features of this property?
This property features: 13,963 SF Walgreens on a 2.29‑acre parcel at 1863 Union Avenue, Memphis, TN; Corporate‑guaranteed NNN ground lease with approximately 49 years remaining through September 2074; Walgreens (tenant) responsible for all property expenses, maintenance, repairs, taxes, and insurance
