Auto parts stores remain in high demand by net lease investors in the $2 million and under sales category. Small investors favor auto parts stores over dollar stores because they tend to be located in primary and secondary markets near bigger retailers. Cap rates for the auto parts sector compressed 27 bps from 4Q14 to 4Q15 and offer the same premium over the general retail net lease market. With today’s car averaging 11.5 years of service, DIY auto repair is a necessity more than a hobby, with Advance Auto Parts, AutoZone, and O’Reilly Auto Parts capturing the majority of demand. 4Q15 cap rates for the three brands were 6.35 percent, 5.75 percent, and 5.68 percent respectively. Advance Auto carries a higher cap rate due to a higher percentage of older stores with lower lease terms.

Source: http://www.ccim.com/cire-magazine/articles/2016/05/market-trends/