1220 9th SE Ave Watertown, SD 57201-5301

Property Details for 1220 9th SE Ave

Year built

1990

Lot size

0.66 lot acres

Property type

Commercial real estate

APN

12393

APU

12393

Description

This exceptional investment opportunity presents a 3,500 square foot Arby's restaurant located at 1220 9th Ave SE in Watertown, South Dakota. The property sits on a 0.66-acre lot and boasts a strong, long-term Absolute NNN lease with a corporate guarantee from a franchisee of DRM, Inc., a large Arby's operator with plans for significant future expansion. The lease commenced October 2, 2023, and extends to October 29, 2043, providing a remaining term of 19 years with 4 or 5-year renewal options. The property features a 5.50% cap rate and a Net Operating Income (NOI) of $141,300, with an asking price of $2,569,000 ($734 per square foot). Built in 1990 and renovated in 2009, this Arby's location generated over $2 million in sales in 2023, significantly exceeding the average for the brand. Sales have shown consistent growth averaging 5.13% annually over the past four years, further enhancing the investment's potential. The lease includes percentage rent based on gross sales, offering substantial upside potential. The property enjoys a prime location at the entrance to Watertown's largest shopping center, benefiting from high traffic volume on US Highway 212, a major east-west thoroughfare and retail corridor, and proximity to Interstate 29. The surrounding area features a concentration of national retailers, ensuring consistent customer traffic. This is a truly passive, hands-off investment with exceptional long-term stability and growth prospects. The 100% occupancy and strong tenant history make this a compelling opportunity for a 1031 exchange.

Location Insight

City

Watertown

County

Codington

State

South Dakota

Longitude

-97.0963

Latitude

44.8897

CBSA code

47980

CBSA name

WATERTOWN, SD MICROPOLITAN STATISTICAL AREA

Property Tax & Assessments