Dollar General building sells for $1,385,856 in Wilton

By KAREN PARKER | County Line Publisher Emeritus

It was more than a little eye-popping when Wilton’s new Dollar General store building sold in September for $1,385,856.

Million-dollar properties in small villages are rare, even in light of escalating construction and real estate costs. But, as it turns out, Dollar General stores are very popular among real estate investors. And why not? With more than 16,000 stores nationwide, the company, headquartered in Tennessee, has enjoyed steady stock growth while averaging 17 percent net growth over the past five years.

But the company has no interest in owning the real estate it occupies. However, it does make an appealing tenant. Its leases run 15 years, the company pays all taxes and insurance on the structure, and it handles any repairs. 

They are especially appealing to small-time investors who may wish to break into the commercial real estate market but can’t tackle the multimillion-dollar properties. In fact, they are so popular that even though the Wilton property is too new to have an assessment, it was sold anyway, presumably based on an appraisal. 

Furthermore, IRS tax code 1031 opens a path for real estate investors to move from small time to big time. Unlike homeowners, they can avoid any capital gains tax. When investors sell business property and use the funds to invest in business property of larger value, they are off the hook and can keep kicking the capital-gains tax down the road almost indefinitely. Relieved of the burden of paying capital gains, the investor not only has pay increase in actual value, but also he or she can use the money saved by not paying capital gains tax to buy increasingly more valuable properties. 

The Dollar General buildings in Cashton and Elroy also were sold. The Cashton store sold in 2019 for $1,245,485. Its 2020 valuation was $1,086,000. The Elroy Dollar General sold in 2019 for $1,070,197. The 2020 assessment for that building was $542,700. 

So who are the new owners of your “neighborhood” Dollar General? No one you would expect to bring brownies to the church dinner or donate a bike for the bike rodeo. Mostly they are owned by LLCs, or limited-liability corporations, although their setup is far different from a corporation, where shareholders are known. LLCs shield the owner from public knowledge and from liability, which rests with the LLC and which owns nothing or very little. Most LLC are pass-through businesses, meaning income is reported on the individual owner’s tax return. 

All LLCs doing business in Wisconsin are required to register with the state. Along with an address for the LLC, the name of the principal agent must be included. Although this may be the owner, that is not always true in every case. 

The purchasers of the Dollar General building in Wilton are four different LLCs, all of whom appear to have a close connection: BCTS, LLC, represented by Becky Tatro of Pleasant Prairie, Wis.; RMDJ, LLC, represented by Jeffrey Wamboldt of Pleasant Prairie; Kumbier Properties, LLC, represented by Wendy Kumbier of Pleasant Prairie; and 1920 Lathrop Ave, LLC, represented by Joseph Wamboldt of Racine. Jeffrey Wamboldt serves on the Kenosha County Board and is an officer with the Kenosha Police Department. 

The Cashton Dollar General building is owned by Palos Verde Investment of Rancho Palos Verdes, Calif. The principal agent in Jing Hui Liu. The Elroy Dollar General building is owned by Knight’s Properties LLC of Lake City, Mo. No registered agent is given. 

It’s hard to believe now, but once upon a time, every small community had a doctor, a lawyer, a feed mill and a cheese factory. Feed mills and cheese factories were consolidated and disappeared decades ago. Yes, the Wilton feed mill became part of Hillsboro Farmers Cooperative, which dissolved into the United Co-op. Suddenly, instead of local management, an entity in Beaver Dam ran the show.

 Grocery and hardware stores hung on for a while, as did restaurants. Rarely were they replaced by larger concerns looking for expansion opportunities. Mostly they simply closed, leaving the landscape wide open for companies such as Dollar General, which stepped in to fill the hole in towns too small for a Walmart. 

According to Consumer Reports, 75 percent of us live within five miles of a dollar store, while just 60 percent of us live within five miles of a hospital. 

Local villages are eager to attract dollar stores. La Farge was recently disappointed when a dollar store was unable to find a suitable site. 

Large communities are accustomed to real estate and business having owners out of the area. But it is still a new phenomenon in small villages. Business owners have always been the backbone of a small town. They rub elbows with their customers at church and at the bar. Their kids go to school with the kids of their customers. They are dependable cheerleaders of local improvement projects, and they support the local newspaper with advertising. 

Sometimes the trend reverses itself. A few years back, United Cooperative of Beaver Dam, Wis., sold off its Fastrip stores in Ontario, Kendall and Wonewoc to a Westby native. But that is unusual. It is hard to get locals willing to make the investment in a mom-and-pop shop, as Ontario recently discovered as it tried to lure commitments to build in what will be a relocated business area out of the floodplain. 

What does the future portend? We once thought Walmart would take over the world, but now Amazon is taking over a lion’s share of the market. 

In time, the role that dollar stores play in small town life may also change. But probably not really soon. 

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