RE #172: Vince Knipp - Senior MD Investments at Marcus Millichap - Single Tenant NNN Retail Assets 101
The Fort
I'm Happy, I Love It. I Love It.
You've been atcus for, i keep same 15 years, but i think it's 15 years. Maybe in 20 22. Youv got there in two thousand seven. Is there a reason why you've stayed there so long? As there's something that they're bringing you.
Vincent Knipp is a Senior Managing Director of Investments in Marcus & Millichap’s Dallas office, where he specializes in net lease investment sales across the United States. Knipp has been the #1 Net Lease Agent in Texas and consistently ranks in the Top 10 Nationally within Marcus & Millichap’s National Retail Group. Over the course of his career, he has closed more than 350 transactions totaling nearly $1 billion in volume in 29 states.
On this episode, Chris and Vince discuss the market for single-tenant NNN assets, 1031's, what makes a good investment in this asset class, what makes a great broker, and a lot more. Enjoy!
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(02:14) - Vince’s Upbringing and Early Career
(05:11) - What were your first years as a broker like?
(07:06) - What’s the mythical ‘database’ that all Marcus agents build?
(08:20) - What did Marcus teach you about making your first calls as a broker?
(10:19) - What makes great retail?
(12:47) - Why do you put all the multi-tenant buildings with your partner?
(15:33) - Who are the typical sellers you work with?
(19:56) - Who are the typical buyers you work with?
(21:32) - How do you value a property in a major metro vs. a smaller town?
(24:14) - In markets where rents are growing quickly, are there a lot of buyers who will buy on a 2 cap and wait it out?
(27:01) - Ground Leases vs. Fee Simple Deals
(29:04) - What usually happens when a tenant leaves their building?
(30:33) - Are all of these leases pretty much the same?
(32:51) - Percentage Rent Clauses
(33:54) - Rent-to-Sales Ratios
(36:44) - Why do people leave?
(38:02) - What other factors are there in leases that are desirable?
(39:54) - Why do sales go down and is it usually tenant-specific?
(41:33) - How much do you pay attention to the specific products your tenants sell?
(42:29) - Are there ever demands from tenants that they’ll only sign unless you agree to not sell the building?
(43:40) - How much does access matter to you, tenants and customers?
(43:35) - All-for-One, One-for-All Scenarios of Tenants
(46:26) - What are tenants requesting now that we’ve been through Covid?
(48:39) - Has the upsurge in drive-through changed things permanently?
(51:52) - Are cosmetic upgrades usually on the operator and not the landlord?
(53:24) - What do you tell people in a transaction that costs 2x more than replacement costs?
(54:40) - Are there any up-and-coming tenants you have your eye on?
(56:05) - How do you conduct due diligence without ever seeing the property in person?
(57:48) - Do ghost kitchens make you nervous?
(58:51) - What’s your favorite deal you’ve ever done?
(1:01:51) - Will you do deals anywhere or are you only based in Texas?
(1:02:32) - Is there a reason you’ve stayed with Marcus for so long?
(1:04:17) - Is there a way to share information across all of Marcus’ agents?
(1:05:45) - Is there anything in the industry that still really excites you after being in it for 15 years?
(1:07:20) - Underwriting Deals with a Franchisee vs. a Franchiser
(1:09:16) - What can go wrong once you’re under contract?
(1:11:34) - How much volume are you expecting for the rest of 2021?
(1:13:20) - How do you sell a ‘party center’ deal?
(1:15:31) - What advice would you give to people getting into the industry today?
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