Strong Corporate Guarantee from H&E Equipment Services (NASDAQ: HEES)
– H&E Equipment Services is one of the largest integrated equipment services companies in the
United States with over 160 branch locations nationwide and is ranked #5 in the Top 100 Equipment
Rental Companies in the United States by RER.
– The company achieved over $1.5 billion in total revenue in 2023 which represented an increase of
18.1% from 2022.
– Through their branch expansion program and strategic acquisitions H&E Equipment Services added
a record 17 branch locations in 2023, or a 14% increase to their branch network.
Strategically Located in the Nashville and Murfreesboro MSAs
– The subject property is ideally located off I-24 which is the main interstate connecting Nashville to
Southeast Tennessee. This location was strategically selected by H&E to service customers in the
South Nashville and greater Murfreesboro areas which are continuing to see massive population
growth.
– Murfreesboro is the sixth largest city in Tennessee, currently growing at a rate of more than 3.5%.
Population growth since the 2010 census has exceeded 52%.
– Nashville is the state’s capital and largest city with a population of over 2 million residents in its
metropolitan statistical area.
– The La Vergne industrial corridor is one of the main industrial corridors in Nashville MSA: located 11
miles from Nashville International Airport and 18 miles from downtown Murfreesboro.
Extremely Low Vacancy Rate for Industrial Outdoor Storage (IOS)
– The subject property is ideally positioned for Industrial Outdoor Storage featuring a 14,225 square
foot facility on 9.13 Acres (4+/- usable acres for outdoor storage). The property features a fully
fenced yard area, offices, parts warehouse, and a repair shop with six service bays and an overhead
crane.
– Limited supply and increased demand have caused IOS vacancy to drop below 3% as of mid-2022,
which is well below the historical average.
– As of the second quarter of 2024, the industrial vacancy rate in the Nashville area was 3.4%, which
is 140 basis points lower than the national average.
Long Term Net Lease with Strong Rental Increases
– H&E Equipment Services signed a new 10 Year and 3-month lease agreement in January 2021 displaying
their long-term commitment to this branch location.
– The Lease offers a strong hedge against inflation with scheduled annual rent increases of 2.5%
throughout the base term and option periods.
– H&E is operating under a Landlord favorable net lease in which the Landlord is only responsible for
roof and structure.
