PetSmart NNN Investor Hub | Cap Rate Trends, Credit Rating Trends, Lease Terms & Due Diligence
Last Year Cap
6.6%
This Year Cap
6.9%
Cap Change
0.3%
Last Year Rating
B+
This Year Rating
B+
Rating Change
No change
PetSmart – NNN Cap Rate Trend
Cap Rate Trends
| wdt_ID | wdt_created_by | wdt_created_at | wdt_last_edited_by | wdt_last_edited_at | Tenant | Year | Cap Rate |
|---|---|---|---|---|---|---|---|
| 5779 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,020 | 6.5 |
| 5780 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,021 | 6.3 |
| 5781 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,022 | 6.0 |
| 5782 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,023 | 6.3 |
| 5783 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,024 | 6.6 |
| 5784 | admin2 | 2026 04:17 AM | admin2 | 2026 04:17 AM | 7 Brew | 2,025 | 6.6 |
| Tenant | Year | Cap Rate |
Credit (what net-lease buyers care about)
Credit Snapshot
PetSmart
PetSmart Net Lease: Secure, Essential Investment
PetSmart is a nationally recognized specialty retail tenant in the pet care industry. This guide reviews cap rates, lease structures, tenant credit profile, and key due diligence considerations for buyers and sellers evaluating PetSmart net lease investments.
Why Investors Target PetSmart Assets
Investors often pursue PetSmart properties for:
- Stable Income Potential
- Recession-Resilient Pet Care Industry Demand
- Large Format Retail Presence in Strong Trade Areas
- Attractive 1031 Exchange Compatibility
Pet ownership trends and recurring spending on pet food, grooming, and services continue to support long-term demand for PetSmart locations.
PetSmart Properties for 1031 Exchange Buyers
PetSmart assets often trade differently than smaller single-tenant net lease properties due to their large box format and mid-tier credit profile.
Buyers should carefully compare:
- Lease structure (NN vs NNN vs modified NNN)
- Remaining lease term (often 5–10 years at sale)
- Location quality (primary vs secondary markets)
- Tenant credit risk (non-investment grade)
- Re-tenanting potential of large box space
Understanding these factors is critical to evaluating long-term risk, exit strategy, and overall return.
PetSmart – Credit Trend (S&P vs Moody’s)
Tenant_Rating_Trend
| wdt_ID | wdt_created_by | wdt_created_at | wdt_last_edited_by | wdt_last_edited_at | TenantKey | Tenant | Year | Moody | SP | Moody_Grade | SP_Grade | Moody_GradeRank | SP_GradeRank |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1 | admin2 | 2025 03:43 PM | admin2 | 2025 03:43 PM | 7eleveninc | 7-Eleven, Inc. | 2022 | Baa2 | A | Lower Medium Grade | Upper Medium Grade | 5 | 6 |
| 2 | admin2 | 2025 03:43 PM | admin2 | 2025 03:43 PM | 7eleveninc | 7-Eleven, Inc. | 2023 | Baa2 | A | Lower Medium Grade | Upper Medium Grade | 5 | 6 |
| 3 | admin2 | 2025 03:43 PM | admin2 | 2025 03:43 PM | 7eleveninc | 7-Eleven, Inc. | 2024 | Baa2 | A | Lower Medium Grade | Upper Medium Grade | 5 | 6 |
| 4 | admin2 | 2025 03:43 PM | admin2 | 2025 03:43 PM | 7eleveninc | 7-Eleven, Inc. | 2025 | Baa2 | A | Lower Medium Grade | Upper Medium Grade | 5 | 6 |
| 5 | admin2 | 2025 03:43 PM | admin2 | 2025 03:43 PM | 99centsonlystoresllc | 99 Cents Only Stores, LLC | 2022 | Caa2 | CCC+ | Substantial Risk | Substantial Risk | 2 | 2 |
PetSmart Investment Market Statistics
AVERAGE SALE PRICE
BUILDING SIZE
AVERAGE NOI
LAND
$/SF RANGE
LEASE TERM SHOWN
PetSmart Investor Snapshot (Quick Facts)
Origins & Growth (Past)
- Founded in 1986 as a specialty pet supply retailer
- Originally focused on warehouse-style pet food and supplies
- Expanded product offerings to include full-service pet care solutions
- Introduced in-store services such as grooming, training, and veterinary care
- Grew rapidly through big-box retail expansion in suburban markets
- Built strong partnerships with national pet brands and private-label lines
- Became the largest specialty pet retailer in North America under PetSmart
Where PetSmart Stands Today
- Leading specialty pet retailer in North America
- Strong national footprint across the U.S. and Canada
- High recurring customer demand driven by pet ownership trends
- Integrated service model (grooming, training, veterinary partnerships)
- Expanding private-label and exclusive product offerings
- Growing omnichannel capabilities (in-store + online + curbside pickup)
- Focus on services, customer retention, and margin optimization under PetSmart
Where PetSmart Stands Today
- More services (grooming, training, vet care)
- Private-label growth
- Digital and omnichannel expansion
- Stronger customer loyalty programs
- Store format optimization
- Focus on recurring pet care spend
- Pet humanization tailwinds driving demand under PetSmart
Why investors buy PetSmart NNN Properties or PetSmart ground Lease Properties?
Pros (what buyers like)
- Established specialty retail brand
PetSmart is a nationally recognized leader in pet care retail, with strong brand awareness and a large customer base - Recession-resistant industry demand
Pet ownership drives consistent spending on food, supplies, and services, supporting stable traffic across economic cycles - Large-format presence in strong retail corridors
Most locations are positioned in power centers or near major anchors, benefiting from high co-tenancy traffic - Service-based revenue model
Grooming, training, and veterinary partnerships create recurring visits beyond traditional retail - Attractive yields for net lease investors
Higher cap rates compared to investment-grade tenants can provide better income returns
Cons (what can bite you)
- Non-investment grade tenant credit
PetSmart carries higher credit risk compared to top-tier net lease tenants, which impacts pricing and financing - Large box re-tenanting risk
Typical 20,000+ SF layouts can be difficult to re-lease if the tenant vacates - Lease structure variability
Many leases are NN or modified NNN, with landlord responsibility for roof and structure - Limited rent growth
Older leases often feature flat rent or minimal increases, affecting long-term income growth - Location sensitivity
Performance is highly dependent on strong retail trade areas and surrounding tenant mix
Investor Decision Framework (Buy / Hold / Sell)
✓ Strong “Buy Box” for a PetSmart Net Lease
• 10+ years term remaining (or 5–10 years with strong renewal options) • NNN or favorable NN lease with limited landlord responsibilities • Located in dominant power center or strong retail corridor • Strong co-tenancy (Target, Walmart, Costco, Home Depot, etc.) driving traffic • High-performing store with solid demographics and dense population • Rent is at or below market (supports re-tenanting and resale value) under PetSmart
02
⚠ Yellow Flags (Price Accordingly)
• NN or modified NNN lease with roof/structure responsibility on landlord • Flat rent with minimal or no increases during the primary lease term • Oversized or outdated store format (hard to backfill large vacant space) • Secondary or weaker retail corridors with declining co-tenancy • Below-average demographics or weak population density • High rent vs market (limits re-tenanting flexibility) • Short remaining lease term without strong renewal options under PetSmart
Find out more
PetSmart Background & History
PetSmart is a leading specialty pet retailer that evolved from a warehouse-style pet supply store into a full-service pet care destination. The company expanded across the U.S. and Canada with large-format stores in power centers, combining product sales with grooming, training, and veterinary services.
Today, PetSmart serves pet owners through a mix of retail and services, supporting repeat visits and consistent demand. The brand has also adapted to changing consumer behavior with omnichannel capabilities, including online ordering and in-store pickup.
Why PetSmart Matters to NNN Investors
PetSmart benefits from recurring consumer spending driven by pet ownership, which supports stable long-term demand. In-store services further increase customer retention and visit frequency.
While traffic is less frequent than convenience retail, basket sizes are typically higher. The combination of essential products and service-based revenue helps maintain store performance across different economic cycles.
our team of experts are here for you
Our team helps investors evaluate NNN properties with practical, market-based guidance. In addition, we support buyers and sellers with lease review, pricing analysis, and due diligence strategy.
Whether you are comparing PetSmart ground lease properties or fee simple PetSmart assets, we can help you review the details that affect risk and long-term value. As a result, clients can make more confident decisions based on lease structure, location quality, and investment goals.
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