SRS National Net Lease Group is bringing to market an investment opportunity in San Diego, California—an absolute triple net (NNN) lease property leased to Carvana (NYSE: CVNA), a well-established, publicly-traded used-car retailer. This newly-constructed, corporate-signed investment property offers numerous attractive features that make it an opportunity for passive investors seeking a management-free investment. The asking price for the property is $32.7 million.
The subject property, located at 1545 Camino del Rio S, boasts the fee simple interest of a state-of-the-art Carvana facility, encompassing both land and building ownership. The tenant has committed to signing a brand new 20-year lease at the close of escrow, underscoring its long-term dedication to the site. This extended lease term provides investors with stable and predictable cash flow for two decades, further reinforced by annual rental increases of 2 percent. These rental escalations not only ensure the growth of net operating income (NOI) but also serve as a hedge against inflation, safeguarding the investment’s long-term value. The projected net operating income for the new owner is $1.8 million with a 5.5 percent cap rate.
One of the standout features of this investment opportunity is the absolute NNN lease structure, which absolves the landlord of any responsibilities related to property management. Carvana assumes all costs associated with common area maintenance, taxes, and insurance, providing investors with a hassle-free and truly passive income stream. This appealing characteristic makes the investment particularly attractive for those seeking a hands-off approach to real estate investing.
Strategically positioned just off Interstate 8/Mission Valley Freeway, the Carvana property benefits from excellent visibility, with over 237,000 vehicles passing by daily. The newly-constructed building showcases a state-of-the-art design and utilizes high-quality materials, ensuring a visually appealing and durable asset, according to the marketing documents reviewed by The Registry. Its location is in the heart of a dense retail corridor, coupled with its proximity to Westfield Mission Valley—an expansive super-regional mall with numerous national/credit tenants, including Target and Trader Joe’s.
The trade area surrounding the Carvana property exhibits strong tenant synergy and draws significant regional traffic. Several nearby auto dealerships, such as San Diego Beemers (BMW), Marvin K. Brown Auto Center (GMC), San Diego Chrysler, and Audi San Diego Fashion Valley, contribute to the consumer draw, promoting crossover store exposure and increasing footfall to the immediate area. With a population of over 533,000 residents and approximately 420,000 employees within a 5-mile radius, the trade area provides a direct and substantial consumer base. Moreover, the average household income of $123,000 within 1 mile of the property reflects the affluence of the local community, presenting a lucrative market for Carvana’s services.
Investing in this Carvana property also offers a unique opportunity to acquire real estate in Southern California’s dense and infill trade area, situated just 8 miles from downtown San Diego. The region’s high barriers to entry and limited potential for new development make this investment even more compelling. Furthermore, the property’s location near a cluster of high-end, newly-constructed apartment complexes, including Metro Mission Valley, the Townsend, and Rio del Oro, ensures a continuous influx of potential customers and further strengthens the trade area’s demographics.
The SRS team working on the marketing efforts for this 18,440-square-foot property includes Matthew Mousavi, managing principal, and Patrick R. Luther, managing principal, who work out of the firm’s Newport Beach office, along with Chuck Klein, executive managing director, who is in the firm’s Solana Beach office.
