Shell Oil

A giant in the petroleum industry, Shell Oil is well recognized for their branding and is owned by the parent company Royal Dutch Shell. They have about twenty five thousand gasoline locations in the United States.

Often backed by independent and regional distribution entities, Shell Oil net leasing finds high demand for their prime real estate selections and solid industry leading assets. There is a wide range of leasing situations and strength of guarantees behind them, due to the nature of mixing various types of operators amongst their gas stations and retail convenience stores.

Shell Oil will typically sign fifteen to twenty year, NNN absolute lease arrangement with rent price bumps during the initial term. Yearly increases may range from 1 1/4 to three percent, or in five year increments at eight to fifteen percent.

 

Shell Oil

In consideration of both real estate and structure owned in fee simple, the allowance for depreciation is granted in most Shell Oil leases. They usually run fifteen year schedules for accelerated depreciation of the building, versus thirty nine years for the average commercial term.

When it comes to the ground assets, they will naturally fluctuate per location. In New England, you will find reduced parcel sizes between 1/3 to 3/5 acre lots. In the southern parts of the U.S., and more specifically in suburban and urban regions where greater populations require more gas by volume, prices will naturally rise with larger lot sizes.

Given the balance between metro transport alternatives found in the Northeast, versus vehicle based reliance in other territories, natural demands for new properties become self-evident. Therefore when reviewing new opportunities, special attention should be paid to company owned, franchise owned, C-store, and gasoline fueling station variables.

Tenant Description

The petroleum giant Shell Oil, now known as just ‘Shell’, operates approximately forty five thousand gasoline fueling stations and retail stores internationally under its name. Larger competitors include the likes of Exxon, Chevron, and ConocoPhillips to name a few.

Technically owned by the parent Royal Dutch Shell, the breadth of their business operations extends to include gasoline, natural gas, oil and other petroleum-based products like LPG (liquefied petroleum gas), along with low-sulphur diesel. They are also involved in refineries, exploratory missions for new petroleum deposits, and petro-chemical production, distribution, manufacturing, and sales. The general public may be familiar with specific retail product names, such as Pura, Optimax, and the V-Power series (including Racing and Diesel), having more than ten thousand C-stores currently in operation.