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Four Corners Continues Expansion, Adds Carrabba's Property

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Four Corners Property Trust FCPT recently announced the acquisition of Carrabba’s property from Seritage for $1.6 million. The move comes as part of its portfolio-expansion efforts.

This South Carolina property is corporate operated with a remaining lease term of three years. Being positioned in a highly-trafficked and populated corridor, it is likely to keep witnessing solid demand. Moreover, with the Seritage portfolio transaction priced at a cap rate in range with the prior Four Corners transactions, the move is a strategic fit. So far, the company has acquired a total of 14 properties for $44.6 million under the Seritage transaction.

Primarily engaged in the ownership of high-quality net-leased restaurant properties, Four Corners maintains an investment grade financial position (Fitch BBB-) and seeks solid acquisition opportunities. The company acquired 23 properties for a total of $36.2 million in first-quarter 2020.

Apart from the above-mentioned acquisition, recently the company revealed a couple of other buyouts as well. It has shelled out $1.8 million for the acquisition of a LongHorn Steakhouse property from Brookfield Properties. This Oklahoma property is corporate operated under a triple-net lease, with the lease roughly having five years of term remaining.

Furthermore, the company has made acquisitions of Texas Roadhouse property in Maine and Colorado. Moreover, there is a two-property portfolio purchase for $7.6 million, as part of the outparcel transaction with Pennsylvania Real Estate Investment Trust, commonly known as “PREIT” PEI.

Located in Maryland and South California, the properties comprise an IHOP and a multi-tenant BJ’s Restaurants BJRI, Sleep Number SNBR and Verizon VZ. These properties are occupied under net leases, with a weighted average remaining term of seven years. Priced at a 6.5% going-in cash cap rate, on a portfolio basis, the transaction marked the fifth and final closing of the PREIT portfolio transaction last November.

While the coronavirus pandemic has hit the restaurant industry hard, the reopening of economy is boosting hopes and things are now looking much better compared with late March, thanks to the recovery in sales. In addition, as of Jun 18, 2020, the company has been able to collect April, May and June rent payments, totaling 91%, 87% and 87%, respectively, of its portfolio’s contractual base rent for those months. Also, acquisitions are expected to drive growth over the long term.

Shares of this Zacks Rank #3 (Hold) stock have appreciated 14.4%, while its industry has gained 4.9% in the past three months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.



 

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Verizon Communications Inc. (VZ) : Free Stock Analysis Report
 
BJs Restaurants, Inc. (BJRI) : Free Stock Analysis Report
 
Pennsylvania Real Estate Investment Trust (PEI) : Free Stock Analysis Report
 
Four Corners Property Trust, Inc. (FCPT) : Free Stock Analysis Report
 
Sleep Number Corporation (SNBR) : Free Stock Analysis Report
 
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