Convenience stores represent a complex and fascinating retail channel that has responded to the economic challenges of the last decade by embracing new ideas, according to a new book by the Appraisal Institute. The second edition of “Convenience Stores and Retail Fuel Properties: Essential Appraisal Issues,” published by the Appraisal Institute, is intended to help appraisers of convenience stores keep up with these changes and understand how real estate value is created and estimated in the industry.
“This book should prove to be a valuable reference not only for real estate appraisers, but also for eminent domain attorneys, convenience store operators and corporate managers,” Appraisal Institute President Sara W. Stephens, MAI, wrote in the book’s foreword.
Among the more than 146,000 convenience stores across the United States, more than 117,000 sell motor fuel. In fact, 80 percent of all motor fuel sold in the United States is sold through the convenience retail channel. The Appraisal Institute’s new book discusses this business model of motor fuel sales combined with a limited selection of high-turnover merchandise. Convenience stores are special-built properties that are designed to make money in only one way. They are not easily adapted to other uses. The fundamental determinant of value for a convenience store property is its ability to generate earnings.
The new edition of “Convenience Stores and Retail Fuel Properties: Essential Appraisal Issues,” compiled by author Robert E. Bainbridge, MAI, SRA, contains updated statistical data and information on important recent developments in the convenience industry, such as reduced fuel profits, competition from hypermarkets and an increased focus on food service. Newly added chapters discuss the fundamentals of economic theory as applied to convenience retail real estate, eminent domain issues and highest and best use essentials for convenience store sites.
The book also presents a prototype of a working commercial property automated valuation model. Links to online digital content, including interviews with experts and practical field examples, are also provided to illustrate the concepts discussed.