Powell Animal Hospital

Institutional-Grade Corporate Guarantee: The lease is corporately guaranteed by Thrive Pet Healthcare, a national veterinary platform operating more than 380 locations across 37 states. Thrive is supported by approximately $800 million in committed capital from TSG Consumer Partners, providing institutional sponsorship and financial backing.
Passive NN+ Lease Structure: Structured as a Double Net Plus (NN+) lease, the tenant is responsible for property taxes, insurance, and maintenance, significantly limiting landlord obligations. Landlord responsibility is limited to roof and structure, supporting a predominantly passive income stream.
Recession-Resilient Healthcare Use: Veterinary services represent a non-discretionary healthcare segment with limited exposure to e-commerce disruption and historical resilience through economic cycles. The global veterinary market is projected to reach approximately $177 billion by 2026, reflecting sustained industry growth.
Strategic Knoxville Growth Corridor Location: Positioned along US Highway 131 (±19,500 VPD), the property benefits from strong visibility and access within the direct path of Knox County’s ongoing residential and commercial expansion.
Proximity to the University of Tennessee: Located approximately 15 minutes from the University of Tennessee’s flagship campus (40,000+ students), the asset serves a dense and stable population base, including faculty, medical professionals, graduate students, and affiliated households.
High Tenant Relocation Costs: Veterinary facilities require substantial capital investment in specialized build-outs, including surgery suites and diagnostic labs. Combined with the importance of maintaining an established local patient base, these factors meaningfully reduce tenant relocation risk.
Contractual Rent Escalations: The lease incorporates scheduled rent increases, supporting organic NOI growth and providing a hedge against inflationary pressures over the lease term.
Tax-Advantaged Location: Situated in Tennessee, which has no state income tax, the asset may be particularly attractive to out-of-state and 1031-exchange investors seeking to enhance after-tax returns.
Strong Submarket Population Growth: Powell is among the fastest-growing submarkets in East Tennessee, currently experiencing approximately 6.67% annual growth, with a projected 2026 population of 16,670 residents, supporting long-term demand fundamentals.
New Multifamily Development: Sheldon Apartments is a 267-unit multifamily development currently under construction, with leasing expected to begin in March 2027. The project will deliver modern residential housing to the area and is positioned to benefit from planned retail development located directly in front of the apartment community, which is expected to break ground within the next year. This mixed-use synergy is anticipated to enhance resident convenience, increase foot traffic, and strengthen the long-term value and desirability of the property.

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Hutt Cooke