Is a Dollar General a good net lease investment? What to actually check

Dollar General is one of the most common single-tenant net lease properties investors ask me about, and one of the most searched. Here's how I'd read one as real estate, not a view on the company's stock, just what actually drives the deal.

How the lease is usually structured

• Long primary terms, commonly in the 10-to-15-year range, frequently with renewal options after that.
• Often a NN or NNN structure, but 'net' is a spectrum. Read exactly which expenses and which parts of the roof and structure are yours versus the tenant's.
• Rent bumps are frequently modest and sometimes sit in the option periods rather than the primary term. Flat rent for a long term quietly loses value to inflation.

What's actually backing the rent

These are typically corporate-guaranteed leases, which is a big part of the appeal. But guarantees and credit ratings change over time, confirm the current guarantor entity and its rating yourself rather than trusting a flyer. The strength of the guarantee is what you're really buying.

The real estate underneath the tenant

Most of these are purpose-built small boxes, often in rural or tertiary markets. The question that decides your residual value is simple: if the tenant ever left, what else is this? A strong corner with traffic re-leases; a weak location is a single-purpose box in a thin market. Underwrite the real estate as if the lease didn't exist, then let the lease be the upside.

Your due-diligence checklist

• Exact net structure, who really pays for roof and structure?
• Remaining primary term and where the rent bumps live.
• The current guarantor and its credit profile, verified independently.
• Location quality, traffic, and whether it's a relocation of an existing nearby store.

The cap rate you're quoted already reflects these factors. Price the location and the remaining term, not just the yield. This is general education, not investment advice, verify everything and read the actual lease before you rely on any of it.