1461 Springhill Avenue
Mobile, AL
Property Overview
- Location 1461 SpringHill Ave Mobile, AL 36604,
- Lot Size +25,047 SF
- Lease Term 18-Year Absolute NNN Lease through 2042
- Lease Type Absolute NNN (No Landlord Responsibilities)
This investment involves a SONIC Drive-In located at 1461 SpringHill Avenue in Mobile, AL, secured by an 18-year Absolute NNN Lease extending through 2042. The lease is entirely passive, as the tenant is responsible for all operating expenses, insurance, and property taxes.
The financial structure is highly favorable, featuring 1.5% annual rent escalations throughout the primary term and all four 5-year renewal options, guaranteeing consistent NOI growth and a hedge against inflation. The property delivers an initial yield of 6.72% cap rate, with market rents supporting a potential pro forma yield of 8.78%. Credit risk is mitigated by a Corporate Guarantee from an experienced national operator managing over 140 units.
The underlying asset is a ±1,422 SF freestanding retail building on a substantial ±25,047 SF corner lot. The location is strategic, situated in a dense infill corridor just 1 mile from Downtown Mobile and 3 miles from the Port, serving a significant local customer base of 65,000 residents within a 3-mile radius.
Highlights
MOBILE, AL & Demographics
The Mobile market is underpinned by substantial economic drivers, including a port system that generated a $98.3 billion statewide economic impact in 2022 and supports 351,359 jobs. This logistical strength is amplified by over $1 billion in current capital projects designed to expand port capacity, including a $366 million harbor modernization. The region's industrial base is expanding, with Airbus employing over 2,000 people and continuing to grow, making Mobile the world's fourth-largest commercial aviation manufacturing center. This growth is part of a larger trend, with Mobile County's Real GDP reaching $23.19 billion in 2023, a 5.14% increase from the previous year. In 2024, the Mobile area attracted $422.3 million in new capital investment, creating 1,391 jobs with an average wage of $59,000.
The property's immediate trade area is densely populated with recession-resistant demand drivers, anchored by the healthcare sector, which is the largest employer in Mobile County and accounts for over 14% of the area's workforce. Major providers like Infirmary Health, with 5,600 employees, and the University of South Alabama, with 5,168 employees and a $3 billion annual economic impact, create a significant daytime population. The city of Mobile's population was 185,097 in 2023, with a median household income that grew 5.29% to $51,090. This consumer base is supported by a growing employed population of 83,195, which saw a 2.09% increase from 2022 to 2023. The retail trade sector is a primary employment hub, with 10,509 residents employed in the industry, indicating a robust and established consumer-facing economy.
| Category | 1-Mile Radius | 3-Mile Radius | 5-Mile Radius |
|---|---|---|---|
| Population (2024) | 11,575 | 64,707 | 116,280 |
| Projected Population (2029) | 11,864 | 65,601 | 117,399 |
| Population Growth (2024-2029) | +2.50% | +1.38% | +0.96% |
| Average Age | 41 | 41 | 39 |
| Households (2024) | 5,230 | 27,444 | 48,058 |
| Household Growth (2024-2029) | +2.37% | +1.35% | +0.93% |
| Median Household Income (2024) | $45,008 | $38,419 | $38,597 |
| Average Household Size | 2.10 | 2.20 | 2.30 |
| Median Home Value (2024) | $187,918 | $104,100 | $99,965 |
