This is a unique investment opportunity. The tenant, Stride Academy, is a State funded Charter School which has been operating in Minnesota since 2000.  8% Cap on initial lease term with escalators during the entire 20 Year lease. This is a unique investment opportunity as it is not based upon ups and downs of the economy and other business factors.

The academy operates the same as any other public school system in the State of Minnesota.  The enrollment has continued to grow to the point where the school needed to relocate to a larger facility. In 2009 the school moved into its current location and occupied 39,000 SF.  Because of continued growth, it became necessary to expand the facility so an additional 33,000 SF of space was completed during the Spring of 2015. 

Here's a quote from David Brain, head of large real-estate investment firm Entertainment Properties Trust, who appeared on CNBC in 2012 to tell audiences just how profitable charter school investment has become. He explained, “Well I think it’s a very stable business, very recession-resistant. It’s a very high-demand product.” Asked about the most profitable sector in real estate investment, Brain said, “Well, probably the charter school business. We said it’s our highest growth and most appealing sector right now of the portfolio. It’s the most high in demand, it’s the most recession-resistant. And a great opportunity set with 500 schools starting every year. It’s a two and a half billion dollar opportunity set in rough measure annually.”

More details: 

Stride Academy, located in St. Cloud, MN, is a State Chartered School grades K-8 with current enrollment of 732 students and growing.  It is a unique learning environment described more fully in their website.

Length of lease:  20 years

Lease Start Date:  July 1, 2015. 

Lease Expiration Date:  June 30, 2035.

Cap Rate: 8% Cap rate is based upon initial term of lease.  There are rent escalators throughout the 20 year lease term.