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DALLAS -- Shoppers in the North Texas region may begin to joke about having a "7-Eleven on every corner," as the convenience store retailer plans to add more than 75 stores in the area over the next three years, according to a report in the Dallas Business Journal.
The additions are part of a plan triggered by opportunities created in the commercial real estate downturn, the report stated. Nationwide, the company will add 550 stores and roughly 4,000 worldwide during the same period, CEO Joe DePinto told the paper.
"We've really positioned ourselves for this," DePinto said in the report. "We have a strong balance sheet, real estate values are down, and a lot of other retailers aren't growing right now, so there's a lot of real estate available that would have been cost-prohibitive in the past."
New North Texas stores will be focused in Dallas, Tarrant, Collin, Denton and Rockwall counties, with new-store investment valued at approximately $50 million through 2001, according to the report. There are currently 266 stores in the area.
"We're seeing a lot of good opportunities for growth," Dan Porter, 7-Eleven vice president of real estate and new store development, said in the report. "With the market being what it is, landlords want a national, [solid] credit tenant, and we bring that to the table. In today's environment, they want someone they can trust to pay the bills every month."
Local growth will include new development, leases, acquisitions and conversions of other retail outlets to 7-Eleven, along with sites in shopping centers and downtown buildings for urban-walkup locations, Porter said in the report. Approximately half of the growth will come from converting or acquiring existing stores, 10 percent will come from ground-up development and the rest will be leases, he added.
Earlier this year, 7-Eleven hired CB Richard Ellis Inc. as its local brokerage, marking the first time the company has used an exclusive broker for expansion, the newspaper reported.
Site selection efforts will be led by Mike Friedman, CBRE senior vice president, and Naveen Jaggi, senior managing director for CBRE's national retail group.
7-Eleven looks for prime, high-profile corners with easy access and preferably a right-hand turn-in for drivers headed to work, Friedman told the paper. While banks and drug stores fiercely competed with 7-Eleven for such corners, the situation has changed, he said.
"[7-Eleven has] a corporate mandate that they want to open more stores, so the timing is perfect in this market," Friedman said. "They're one of the very few national retailers that are on a massive expansion program."
The company also plans to remodel 3,000 stores nationwide over the next two to three years, with many in North Texas, and at a cost of $160,000 to $180,000 per store, according to the Dallas Business Journal.
7-Eleven is able to expand in the current economy because of reduced debt and the company has remained profitable. 7-Eleven's total debt is about one-third of what it was in 1999, Porter said in the report.
"Strong companies continue to grow and take advantage of the market opportunities whether the economic times are good or bad," Porter said. "We've brought down our debt over the years, and, with real estate values down and other retailers contracting, it's a very good time to grow."
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