Walgreens recently announced plans to close 200 US stores as part of a cost-cutting initiative that will increase savings by an extra $500M by the end of 2017. Meanwhile, the company is reporting sales of $21B, up 7.4%, and an adjusted net earnings of $1.2B, up 33.2%. With the company's history as a top retail asset, the announcement has some wondering if investor interest will be affected. Westwood Net Lease Advisors president Chris Schellin doesn't think so, NREI reports. Schellin cites the company's strong history in the net-lease sector and the fact that it commands some of the best loan terms in the market. Additionally, the chain's properties with long-term leases are in high demand among 1,031 exchange buyers. However, the store is experiencing historically low cap rates (as are CVS and Rite Aid). And no matter how you look at it, the value of a dark store is less than the value of an operating store. For that reason, Boulder Group president Randy Blankstein feels that investors will be more selective than before, and look more closely at the sales performance of potential acquisitions. [NREI]
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