Overview
Marcus & Millichap is pleased to present the opportunity to purchase the fee simple interest in a single tenant Strack & Van Til Grocery Store located in Valparaiso, Indiana. Strack & Van Til is a wholly owned subsidiary of Hy-Vee, following Hy-Vee’s acquisition of Strack in April of 2024. The Strack acquisition marks Hy-Vee’s first significant expansion into Indiana and the larger Chicagoland MSA.
This location has been a grocery store since 1978 and serves a wide-ranging trade area in Northwest Indiana. The tenant has over 11 years of lease term remaining and is currently paying $8.20 per square foot in base rent, with a a 10% rent increase coming in 3 years. There’s another 10% rent increase 5 years after that, followed by an additional 10% rent increase 3 years later in the tenant’s next renewal option. It’s an attractive and rare cadence to the increase structure.
Investment Highlights
• Single-Tenant Strack & Van Til (Hy-Vee) Grocery Store Offered at a Low Basis With Over 11 Years of Term
• Significant Pending Rent Bump Within 3 Years That Will Increase Rents 10 Percent and Push the In-Place Cap Rate 60 Basis Points
• Attractive Cadence to the Rent Increase Structure With an Additional 10 Percent Increase Coming in 2033, and Another 10 Percent Rent Increase Scheduled 3 Years After That at the Start of the First Option Period
• Strack & Van Til Is the Dominant Grocer in Northwest Indiana and Was Acquired by Hy-Vee in 2024. Hy-Vee’s Purchase of Strack & Van Til Marks Hy-Vee’s First Expansion Into the Eastern United States and Provides a Strong Indication of the Brand’s Expansion Trajectory.
• Tenant Only Pays $8.20 per Square Foot in Base Rent; Newer Construction Grocery Stores Require Over $20 per Square Foot Rents to Account for Record-High Construction Costs.
• Excellent Location Off U.S. Highway 30 in Valparaiso With Visibility to Over 30,000 Vehicles per Day
• Available for Purchase Along With the Adjacent Multi-Tenant Retail Center, Offering an Owner the Ability to Achieve Significant Scale With a 94,000-Square-Foot Food & Drug Anchored Retail Center, 85 Percent of the Income of Which Will Be Guaranteed by Strack & Van Til
• Limited Landlord Responsibilities
• Located Two Miles West of Valparaiso University and in Close Proximity to Downtown Valpo
• Average Household Incomes Exceed $100,000 Annually With Strong Population Growth Trends
• Northwest Indiana Is Part of Greater Chicagoland but Is Renowned for Its Favorable Pro- Growth Culture and Low Real Estate Taxes
Sales Team
