Four Corners Property Trust (NYSE:FCPT), a real estate investment trust engaged in the ownership of high-quality, net-leased restaurant properties (“FCPT” or the “Company”), is pleased to announce that it has signed a definitive agreement for the purchase of 23 outparcel properties (26 leases) from Seritage Growth Properties (NYSE: SRG) for $67.9 million. Including FCPT’s estimated capital expenditures related to leasing the final inline space at one of the multi-tenant properties, the total consideration is approximately $68.4 million. The transaction is priced at a cap rate in range with past FCPT transactions. The portfolio includes 21 single tenant restaurant properties and 2 restaurant-anchored, multi-tenant properties. The transaction is expected to close in various tranches throughout 2019 and 2020, subject to customary closing conditions and regulatory approvals.
The 23 outparcels span 18 restaurant brands including 8 which are new to FCPT’s portfolio. The restaurant brands include Bahama Breeze, BJ’s Restaurant, Carrabba’s, Chick-fil-A (3), Chili’s, Corelife Eatery (new), Hook & Reel (new), Hopdoddy Burger Bar (new), Krispy Kreme (new), LongHorn Steakhouse (3), Olive Garden, Outback Steakhouse (2), Pollo Tropical (new), Popeye’s, Portillo’s (new), Shake Shack (new), Smokey Bones (new), and Wendy’s (2). The portfolio also includes 2 non-restaurant brands, Jared Jewelry and Orvis, which are inline tenants in a multi-tenant building. The restaurant-anchored multi-tenant properties share similar qualities with FCPT’s restaurant assets and are in close proximity to FCPT owned restaurants. The properties in this transaction have building or leased-space sizes comparable to FCPT’s existing portfolio, contractual rent stream growth, net-lease structures, and strong tenancy with credit-worthy operators.
The retail outparcels are located within highly trafficked and populated corridors in Delaware, Florida, Illinois, Indiana, Michigan, Missouri, New Jersey, Ohio, Rhode Island, South Carolina, Tennessee, Texas, and Virginia. Of the 26 leases, 22 are with the brand’s corporate entities. Each property has a separate individual lease and the leases have a current weighted average remaining term of approximately 8 years. Additionally, 15 of the 23 properties are recently constructed as part of Seritage’s redevelopment strategy (less than 3 years since opening).
Bill Lenehan, CEO of Four Corners Property Trust, stated: “The Seritage portfolio marks FCPT’s third and largest announcement of significant outparcel portfolios in the past three months. The three portfolios total $153 million of announced volume across 67 properties. This transaction is consistent with our outparcel strategy of acquiring diverse brands in the restaurant and retail sectors with strong operators. This is a high-quality portfolio with favorable demographics and established or growing brands in busy retail corridors across 13 states.” Mr. Lenehan added, “The Seritage team has been fantastic partners on this transaction and we are excited to support their efforts in continuing to transform and create value within their portfolio.”
FCPT, headquartered in Mill Valley, CA, is a real estate investment trust primarily engaged in the acquisition and leasing of restaurant properties. The Company seeks to grow its portfolio by acquiring additional real estate to lease, on a net basis, for use in the restaurant and retail industries. Additional information about FCPT can be found on the website at www.fcpt.com.
This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include all statements that are not historical statements of fact and those regarding FCPT’s intent, belief or expectations, including, but not limited to, statements regarding: operating and financial performance; and expectations regarding the making of distributions and the payment of dividends. Words such as “anticipate(s),” “expect(s),” “intend(s),” “plan(s),” “believe(s),” “may,” “will,” “would,” “could,” “should,” “seek(s)” and similar expressions, or the negative of these terms, are intended to identify such forward-looking statements. Forward-looking statements speak only as of the date on which such statements are made and, except in the normal course of FCPT’s public disclosure obligations, FCPT expressly disclaims any obligation to publicly release any updates or revisions to any forward-looking statements to reflect any change in FCPT’s expectations or any change in events, conditions or circumstances on which any statement is based. Forward-looking statements are based on management’s current expectations and beliefs and FCPT can give no assurance that its expectations or the events described will occur as described. For a further discussion of these and other factors that could cause FCPT’s future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in FCPT’s most recent annual report on Form 10-K, and other risks described in documents subsequently filed by FCPT from time to time with the Securities and Exchange Commission.
Bill Lenehan, 415-965-8031