Starbucks - Tenant Overview


August 26, 2023


Tenant Description

Starbucks, founded in 1971 in Seattle, is a global coffeehouse chain that has become synonymous with the coffee culture itself. With over 33,000 locations worldwide, it's a tenant that brings foot traffic, brand recognition, and a certain lifestyle cachet to any commercial real estate property. The company has a strong focus on ethical sourcing of its coffee beans and has built a robust supply chain that ensures quality and sustainability.

From a landlord's perspective, Starbucks often opts for prime locations, usually in high-traffic areas like shopping centers, downtown districts, and near educational institutions. They invest heavily in store design and ambiance, creating a "third-place" environment where people can relax or work, which in turn increases dwell time and can benefit neighboring tenants. Their lease agreements often include clauses that reflect their specific operational needs, such as extended hours and exterior branding.

Financially, Starbucks is a strong tenant. As of 2020, the company reported revenues of $23.5 billion. They have a reputation for being a stable and reliable tenant, often signing long-term leases, which is a plus for any commercial real estate portfolio. Their business model is somewhat recession-resistant; even in economic downturns, people tend to continue their coffee habits.

However, it's worth noting that Starbucks has been closing some underperforming stores and focusing on drive-thru and mobile ordering, a trend accelerated by the COVID-19 pandemic. This could mean they'll be more selective about future locations, possibly favoring sites that can accommodate drive-thrus or offer easy curbside pickup.

Looking ahead, Starbucks has aggressive expansion plans. Over the next five years, the company aims to open 3,500 net new stores in the "Americas," primarily focusing on middle America and the South. More than 80% of these new stores will be drive-thru locations. They also plan to modernize their existing stores, with a target of 2,000 net new stores in the U.S. by 2025. This evolving strategy could have implications for landlords and investors, making it crucial to stay abreast of their real estate needs.

In summary, having Starbucks as a tenant is generally a strong play. They bring brand power, financial stability, and a customer experience that can elevate an entire commercial space. But keep an eye on their evolving business model, as it could impact their real estate needs moving forward.

Average Asking Cap Rate


3 mo avg with (812 properties)

Typical Investment/Lease

Average Sale Price




$/Square Foot

$991 - $1,289

Building SF

2,200 - 2,500

Approx. Store Count


Lease Term

10 Years


5%-10% Every 5 Years

Stock Symbol


Credit Quality


Investment Grade

Average Asking Cap Rate Trend





Reflect only properties with long-term lease.

Need Capital for an STNL Development?

We offer a full capital stack solution for BTS and ground lease developments.