CVS buildings for sale

[Rouelle]

---

Members don't see this ad.

A fairly large number of the CVS buildings in my metro are currently for sale. These range from older converted former Eckerds Drug to new (<5 year old) CVS builds. It appears that CVS is staying as tenants with NNN leases. I wonder what’s going on. Are they trying to free up some capital for some reason?

 

[lord999]

Yes, they have collateral calls on loans with Citi and can’t refinance debt under the segment that they would sell under for bonds.

 

[mentos]

CVS is closing 10% of stores. It also has a boatload of debt which makes it difficult in this high interest rate environment.

Are you going to buy some and be their landlord?

 

[mentos]

Are you going to give me a mortgage?

Can't you pull a HELOC with all your properties?

 

[mentos]

Theoretically speaking:

It would mess up my plan. I have refinanced the mortgages to low interest rate.

I would have to do a cash out refi or borrow from it which means I would have to accept today’s high mortgage rate. I would also need to take more risk.

Years ago, I did a back of the napkin calculation and assuming 4% appreciation per year, you would need just three rental properties to replace a pharmacist’s salary because of the generous tax benefits.

I told all my pharmacist friends this. They were interested but for one reason or another, no one did it.

Saving up the down payment is a hard obstacle. Once people get over that hurdle for their primary home, it's hard to do it again. They tend to upgrade their lifestyle, eat out more, buy expensive cars, go on fancier vacations etc. Lots of pharmacists living paycheck to paycheck. Of course there's many who do well too.

 

[mentos]

Theoretically speaking:

It would mess up my plan. I have refinanced the mortgages to low interest rate.

I would have to do a cash out refi or borrow from it which means I would have to accept today’s high mortgage rate. I would also need to take more risk.

Years ago, I did a back of the napkin calculation and assuming 4% appreciation per year, you would need just three rental properties to replace a pharmacist’s salary because of the generous tax benefits.

I told all my pharmacist friends this. They were interested but for one reason or another, no one did it.

I don't get it, can't you still take a HELOC then if you've already refinanced? You're taking a new loan on the equity, not refinancing with a new mortgage. So it doesn't matter what your current interest rate is.

 

[mentos]

^ what would the new interest rate on the HELOC be? Would you pay 10% interest rate on a loan to invest in a business that only makes 7% return?

So are you saying real estate is only a good investment if you lock rates under 3%, which we'll probably never see for another 10+ years? If so then that's no different than that lion guy bragging about his wins after they're already green.

 

[GrandTheftAutumn]

Pharmacists starting salary is high (used to at least).

Paging "new grad only makes $45/h, 32h/week, dental hygienist make more with less education/debt" dude

 

[mentos]

Paging "new grad only makes $45/h, 32h/week, dental hygienist make more with less education/debt" dude

That's probably true depending on location.

 

[randompharm]

Paging "new grad only makes $45/h, 32h/week, dental hygienist make more with less education/debt" dude

This. 6-8 years less to be precise, or 500-700k in their pocket before a pharmacist even enters the workforce, not accounting for raises.