Thursday, April 30, 2009

7-Eleven hires company to perform 'comprehensive review'

Some of 7-Eleven Inc.'s landlords may be taking a big gulp.
The iconic convenience store chain said Wednesday that it has hired international real estate service firm CB Richard Ellis to make a "comprehensive review" of all of its U.S. store locations.
CB Richard Ellis said the task will "include analyzing fair-market values for 7-Eleven's retail sites and negotiating lease terms, when appropriate, in line with current commercial rental rates."
That means lower rents.
It's something other big retailers have pressed upon landlords because of the tough economy.
"This is prudent business practice for any retailer during these unusual economic times, particularly with the footprint that 7-Eleven has nationwide," Mike Friedman, a CB Richard Ellis senior vice president in Dallas, said Wednesday in an announcement that effectively puts the retailer's landlords on notice.
"Through our analysis, we believe we will discover solutions that will assist 7-Eleven in reducing its overall operating expense."
The company operates about 5,700 stores in the U.S., including 263 in the Dallas-Fort Worth area.
Real estate brokers say there's a lot of buzz in their business about retailers getting rent cuts, but they question just how much is going on.
"If you have a lease on a property, you usually have a lender involved and it's not the easiest thing to just go reduce rents," said W. Thurston Witt Jr. of Dallas-based United Commercial Realty.
"There has been a lot of discussion about it, but I don't know how much success there has been at this point." Real estate service firm CB Richard Ellis was hired to help 7-Eleven reduce its overall operating expense. " - Steve Brown/DMN