Automotive service and healthcare tenants are popular with net lease investors because their services generally have to be delivered in person and demand for them is driven by needs rather than discretionary spending. Those strengths are real, but they do not guarantee that a particular tenant will stay solvent or that a particular property will stay leased. This page reviews both sectors, the credit of common tenants (ratings update from our database), and the risks to underwrite. For what investment grade means, see the investment grade guide.
Automotive Tenants
Vehicle owners need maintenance and repairs regardless of the economy, and in downturns many keep older cars longer instead of buying new ones. The average age of light vehicles on U.S. roads reached a record of about 12.8 years in 2025, according to S&P Global Mobility. Oil changes, brakes, and tires cannot be done online, though parts retailers do face online competition for some sales.
| Tenant | Rated entity | S&P / Moody’s | Status |
|---|---|---|---|
| AutoZone | AutoZone, Inc. | BBB/Baa1 | investment grade |
| O’Reilly Auto Parts | O’Reilly Automotive, Inc. | BBB/Baa1 | investment grade |
| Advance Auto Parts | Advance Auto Parts, Inc. | BB | not investment grade |
| NAPA Auto Parts | Genuine Parts Company (parent) | BBB-/Baa1 | investment grade |
| Firestone Complete Auto Care | Bridgestone Corporation (parent) | A/A1 | investment grade |
| Goodyear auto service | The Goodyear Tire & Rubber Company | BB- | not investment grade |
| Valvoline Instant Oil Change | Valvoline Inc. | BB | not investment grade |
| Pep Boys | Mavis Tire Express Services (parent) | B- | not investment grade |
Risks include electric vehicles, which need fewer oil changes and some other services, competition among service chains, and franchised locations whose leases are signed by local operators rather than the rated parent.
Healthcare Tenants
An aging population and the shift of care from hospitals to outpatient settings support demand for dialysis clinics, urgent care, dental offices, and ambulatory centers. Many healthcare tenants invest heavily in their buildouts, which can encourage them to stay. But essential demand does not by itself ensure that an operator stays solvent or that a property stays leased: reimbursement rates, staffing costs, local competition, debt, and the lease guarantor all matter.
| Tenant | Rated entity | S&P / Moody’s | Status |
|---|---|---|---|
| DaVita | DaVita Inc. | BB | not investment grade |
| Fresenius Kidney Care | Fresenius Medical Care AG | BBB-/Baa3 | investment grade |
| CareNow Urgent Care | HCA Healthcare, Inc. (parent) | BBB | investment grade |
| MedExpress Urgent Care | UnitedHealth Group (parent) | A+/A2 | investment grade |
| Concentra | Concentra Group Holdings Parent, Inc. | BB | not investment grade |
| Aspen Dental | ADMI Corp / The Aspen Group | B- | not investment grade |
| AFC Urgent Care | American Family Care (franchisor) | no verified rating | not yet verified |
| BioLife Plasma Services | Takeda Pharmaceutical (parent) | BBB+/Baa1 | investment grade |
DaVita, for example, is rated below investment grade, and Aspen Dental and many urgent care operators are private equity owned with speculative ratings or none. Where a parent company is rated, confirm whether it signs or guarantees the lease.
What These Sectors Offer and What to Watch
| Factor | Automotive | Healthcare |
|---|---|---|
| Demand driver | Aging vehicle fleet; repairs instead of replacement | Aging population; outpatient care growth |
| Online competition | Low for service; moderate for parts | Low for in-person care; telehealth for some visits |
| Main risks | Electric vehicles, franchisee credit, competition | Reimbursement cuts, staffing costs, operator leverage, specialized buildouts that are costly to re-lease |
| Credit range | Investment grade (AutoZone, O’Reilly) to speculative (Advance Auto Parts, Valvoline) | Investment grade (Fresenius, HCA) to speculative or unrated (DaVita, Aspen Dental, many urgent care operators) |
Live asking cap rates for several of these tenants are on the NNN cap rates page. See also our automotive tenant guide and healthcare tenant guide.
Buying, Selling, or Financing an Automotive or Healthcare Property?
We can review the tenant, guarantor, and lease, price the property against current listings, and help with acquisitions, sales, sale-leasebacks, and refinancing.
Frequently Asked Questions
Is DaVita investment grade?
No. DaVita is rated BB, below the BBB‑/Baa3 investment grade threshold.
Are healthcare NNN tenants recession proof?
No tenant is recession proof. Healthcare demand tends to hold up, but operators can still struggle because of reimbursement changes, labor costs, competition, or heavy debt, so analyze each operator and lease.
Why do automotive tenants hold up in downturns?
Many owners repair older vehicles rather than buy new ones, and service work must be done in person. Results still vary by company and location.
Educational content only. InvestmentGrade.com is a commercial real estate brokerage and educational publisher. We do not sell, broker, underwrite, or solicit any bonds, securities, or investment products. Yields, ratings, and prices referenced fluctuate continuously and are sourced from public market data as of the date noted. Nothing on this page constitutes investment advice, an offer to sell, or a solicitation to buy any security. Consult a licensed broker-dealer, registered investment advisor, or tax professional before making any investment decision. For SEC investor education, visit investor.gov.
