Faris Lee Investments Completes Three Single-Tenant NNN Leased Retail Property Sales
Irvine, CA – October 11, 2011 – (RealEstateRama) — Faris Lee Investments, the nation’s largest retail-specialized investment advisory firm, has recently closed several single-tenant NNN leased property sales totaling more than $6.5 million including a property occupied by Del Taco in McKinney, TX, a property occupied by Carl’s Jr. in Newhall, Calif., and a property occupied by Wells Fargo in Stallings, NC. With this recent deal activity, the firm has completed a total of 20 single-tenant, NNN leased retail property transactions this year valued in excess of $50 million, proving that the single-tenant property category continues to be in demand by investors.
Dennis Vaccaro, senior managing director at Faris Lee points out that passive investors are actively seeking a safe haven. Uncertainty and volatility in alternative investment classes are causing a strong run-up in demand in particular for long term net leased properties.
“As new development in California has slowed to a trickle, our California-based investors are more often willing to invest in out-of-state properties,” adds Vaccaro. “We are often best able to match up their investment goals with new sites being developed in growth markets.”
Matt Mousavi, director with Faris Lee Investments adds: “Net leased properties provide a buyer with the ability to achieve a stable and passive ROI with very little, if any, management responsibilities. These returns coupled with the safety of owning a hard asset is attracting a wide range of buyers. A good amount of the single-tenant asset buyers Faris Lee has been working with this year are first time property owners. Many of these deals have broken sales records as the investor pool grows and demand for well-located, well-performing NNN-leased single-tenant properties increases.”
Just recently, Matt Mousavi and Dennis Vaccaro of Faris Lee Investments closed the $2.6 million sale of a 2,703 square foot property occupied by Del Taco in McKinney, TX. The sale garnered a $965 per square foot price, the highest achieved for any retail property sold in the state of Texas this year. The sale closed at a 6.1 percent cap rate, which according to Costar, was the lowest cap rate for a single-tenant property leased to a private company since 2009 in the state. Mousavi and Vaccaro represented the seller, a Dallas-based private developer. The Southern California-based buyer was in a 1031 exchange out of an apartment property and was represented by 39 Commercial Realty. The deal was all-cash and closed escrow in just three weeks.
“This record-breaking transaction is an impressive one from its high price point, and is also testament to the fact that California buyers are seeking to expand their property portfolios in other states,” said Vaccaro. “Faris Lee helped the buyer understand the advantages of the Texas retail market, and was able to provide experienced insight into Del Taco, a private company with no public financial data, as a company and as a concept in general.”
Mousavi also completed the all-cash sale of a 2,700 square foot property occupied by Carls Jr. in Newhall, Calif. for $2,015,000. Mousavi represented the buyer, PBKL, LLC, a private investor from Orange County. John Glass of Marcus and Millichap represented the seller, Carl Karcher Enterprises, Inc. The deal was a corporate sale-leaseback with Carls Jr. Corporate (Carl Karcher Enterprises, Inc.). The transaction had multiple offers and was sold above list price.
“The fact that Faris Lee was extremely aggressive in the price and structure of our offer is what differentiated us as buyers from the other bidders,” said Mousavi. “Faris Lee conducted most of the due diligence before going under contract, managed the process for the buyer, and ultimately won the buyer a great investment. The property closed with a brand new 20-year corporate lease with Carl Karcher Enterprises, Inc.”
Faris Lee Investments also completed the $1.44 million sale of a 3,880 square foot Wells Fargo property in Stallings, NC. Rich Berlinghof and Mousavi represented the seller, JDH Capital out of North Carolina. The 1031 exchange buyer was the Crisp Family Trust out of Northern California and was represented by Nick Davidson of CIRE Partners. The all-cash transaction closed in less than 30 days at a 6 percent cap rate. The property went under contract in less than one week after it was listed.
Faris Lee procured multiple offers from investors from different parts of the country and chose to go with the 1031, all cash, list price from a California investor. The cap rate was low at 6 percent as the Wachovia (now Wells Fargo) lease had less than 10 years remaining in term. Faris Lee was able to overcome this issue by highlighting the fact that the property was an outparcel to a prominent grocery and drug anchored center with high traffic and strong visibility.
About Faris Lee Investments
Faris Lee Investments is a leading national real estate investment advisory firm, comprised of three (3) integrated business platforms; Faris Lee Investment Banking, Faris Lee Capital and Faris Lee Advisors. The company’s high-level retail investment advisors and sophisticated financing experts develop forward-thinking strategies for all retail acquisitions and dispositions and guide clients through complex transactions. Cumulatively, the Faris Lee’s leadership has been involved in more than $20 billion of transactions. Faris Lee’s senior experts are skilled in disposition and acquisition strategies, 1031 exchanges, asset positioning and valuation, marketing, debt and equity structuring, strategic workout and REO solutions and execution. For more information, please visit www.farislee.com.
