Sherwin-Williams is the largest paint and coatings company in the world and one of the most overlooked NNN tenants in the spread analysis. Its BBB / Baa2 credit rating backs both senior unsecured bonds yielding approximately 5.15% and NNN store properties trading at 5.50% to 6.75% cap rates, producing a nominal spread of 35 to 160 basis points on identical corporate credit.
For the full 21-company comparison, see the Bond-to-NNN Spread Anchor Page. For the complete Sherwin-Williams tenant analysis, see the Sherwin-Williams Credit Rating and NNN Cap Rate page.
Sherwin-Williams Credit Profile
| Metric | Details |
|---|---|
| S&P Rating / Outlook | BBB / Stable |
| Moody’s Rating / Outlook | Baa2 / Stable |
| Investment Grade Status | Investment Grade |
| Ticker | NYSE: SHW |
| US Store Count | ~4,800+ company-owned stores |
| Annual Revenue | ~$23 billion (FY2024) |
The Spread: Sherwin-Williams Bonds vs. NNN
| Metric | SHW Corporate Bond | SHW NNN Property |
|---|---|---|
| Yield / Cap Rate | ~5.15% (5-10yr senior unsecured) | 5.50% to 6.75% |
| Nominal Spread vs. Bond | Baseline | +35 to +160 bps |
| Minimum Investment | ~$1,000 (via broker) | ~$800,000 to $2,500,000 |
| Liquidity | Sells in seconds | 60 to 90 day sale cycle |
| Income Taxation | Ordinary income (up to ~45.8%) | Sheltered by depreciation |
| 1031 Exchange Eligible | No | Yes |
| Typical NNN Lease | N/A (debt instrument) | 10 to 15 year NNN, corporate guarantee |
| Building Size | N/A | 3,000 to 6,000 SF |
Bond yield is approximate, derived from Sherwin-Williams’ BBB/Baa2 rating-tier position relative to the ICE BofA BBB US Corporate Index (~5.29% as of March 19, 2026, per FRED). NNN cap rates from InvestmentGrade.com IG 180 database. This is not investment advice.
The Hidden NNN Gem: 4,800 Company-Owned Stores
Most bond investors know Sherwin-Williams as a $23 billion paint and coatings manufacturer. Few realize the company operates one of the largest company-owned retail store networks in the United States: over 4,800 locations, all corporately operated (not franchised), all backed by the SHW parent guarantee. This store count exceeds O’Reilly Auto Parts, AutoZone, and Dollar Tree. Yet Sherwin-Williams NNN properties receive far less attention from NNN investors because “paint store” does not carry the same immediate recognition as “auto parts” or “dollar store” in the net lease market.
This relative obscurity is part of what creates the spread. Sherwin-Williams stores are small-format (3,000 to 6,000 SF), typically located in strip centers or small freestanding buildings. The NNN market prices them with a cap rate premium because the building format is modest, the locations are often in secondary commercial corridors, and the “paint store” label does not generate the same buyer excitement as a McDonald’s or a Dollar General. The bond market does not share this bias. A Sherwin-Williams bond is backed by a globally dominant coatings company with $23 billion in revenue, strong free cash flow, and a 47-year consecutive dividend increase streak. The disconnect between how the bond market values SHW credit and how the NNN market values SHW real estate creates the 35 to 160 basis point spread.
Professional Customer Base = Recession Resilience
Sherwin-Williams stores serve two customer segments. Professional painters and contractors account for approximately 60% to 70% of store revenue. These customers purchase paint in volume for ongoing residential and commercial projects, creating a recurring revenue base that is less discretionary than consumer retail. DIY homeowners account for the remaining 30% to 40%. The professional skew matters for NNN investors because it means the stores’ revenue is driven by construction and maintenance activity rather than consumer sentiment, providing a more stable underlying business than many retail NNN tenants.
This professional customer concentration also explains why Sherwin-Williams stores rarely close. A professional painter who has built a relationship with a specific store and its staff will not switch to a competitor because of a minor price difference. The switching costs are embedded in the relationship, not the product. This customer stickiness translates directly into lease renewal probability, which is the most important factor in NNN residual value.
As of Q1 2026, the nominal spread is approximately 35 to 160 basis points. Sherwin-Williams bonds yield roughly 5.15% while NNN properties trade at 5.50% to 6.75% cap rates. The range is driven primarily by location quality and remaining lease term. Stores in strong commercial corridors with 10+ years remaining trade at the tighter end.
Sherwin-Williams operates 4,800+ company-owned stores but receives less NNN market attention than tenants like Dollar General or AutoZone because “paint store” does not carry the same investment profile recognition. This lower visibility contributes to the spread: properties from less-followed tenants attract a smaller buyer pool, which supports wider cap rates relative to the underlying credit quality. For informed investors, this represents an opportunity to earn excess yield on a $23 billion enterprise.
Yes. Sherwin-Williams NNN properties typically price between $800,000 and $2,500,000, making them accessible for 1031 exchanges from smaller residential or multifamily sales. The small format, investment grade credit, and corporate guarantee provide a straightforward, passive replacement property for investors exchanging out of management-intensive assets.
Considering Sherwin-Williams NNN?
We source Sherwin-Williams NNN properties nationally. On the majority of transactions, the listing broker pays a cooperating commission, so there is typically no separate fee to you as the buyer.
Find It — SHW NNN with corporate guarantees from a $23B enterprise.
Fund It — BBB/Baa2 credit with 47-year dividend increase streak. Strong lender confidence.
Exit It — Small-format IG NNN appeals to a broad buyer pool.
Exchange It — Price points from $800K fit smaller 1031 exchanges perfectly.
