Gas Station/Convenience Stores

[Alan McCoy]

For anyone with advice or has ever owned/invested in a gas station, I am looking for a mentor that can teach and instruct me of the pitfalls and benefits of buying a gas station. I reside in Jacksonville, FL and am looking in the surrounding area. Any information is appreciated.

[Taryn Spiller]

Hi Alan,

My colleague Matt Coates who specializes in Convenience Stores has an answer to your question:

Pros – advantage of utilizing accelerated depreciation (consult with your accountant before making an investment decision based on this); e-commerce proof (no one is going to get gas delivered to their front door; even if they did, they would pay a substantially premium for it, not to mention the purchased gas would likely be coming from the gas station anyway); recession proof; generally well-located assets

Cons – potential environmental issues (some tenants are, per the lease in place with the Landlord, responsible for any potential environmental issues that may arise; e.g. 7-Eleven); highly competitive market; usually pay above market rents due to potential of ground contamination down the line (therefore, if the tenant vacates the site, you would likely be faced with a situation where you could not replace the rent)

Also, Matt Coates said he would be happy to speak with you over the phone about any questions you have about investing in convenience stores and gas stations, so feel free to reach out to me and I can give you his contact information.