COMMERCIAL REAL ESTATE TRANSACTION ALERT
Deal has one of the lowest cap rates ever recorded for a single-tenant net lease QSR in the Inland Empire per CoStar records
SRS Real Estate Partners’ National Net Lease Group has announced the $2.67 million ground lease (land ownership) sale of a newly developed freestanding retail property occupied by Taco Bell at 1460 Sixth Street in Norco, CA. A franchisee for Taco Bell recently signed a 25-year ground lease at the site and opened for business.
SRS National Net Lease Group’s Managing Principals Matthew Mousavi and Patrick Luther represented the seller, a local developer. The buyer, a private investor from Southern California, was represented by Hunter Morgan of CURB Realty. The closing cap rate was 3.93 percent, one of the lowest cap rates ever recorded for a single-tenant net lease QSR (quick service restaurant) in the Inland Empire per CoStar records.
Situated on .49 acres, the property totals 2,558 square feet (sf) and includes a drive-thru. The asset is part of Norco Gateway Shopping Center which is anchored by an 18,000-sf Grocery Outlet and 6,000 sf of future retail shops. Other nearby retailers include Rite Aid, Stater Bros, Boot Barn, 99 Cents Store, and Dollar Tree, among others.
“This is the second asset we have sold at Norco Gateway Center as part of a break-up strategy in order to maximize the value for our seller/developer client,” said Mousavi. “In October 2020, our SRS team completed the $6 million sale of the Grocery Outlet property which sold at close to a 5 percent cap rate. Both the Taco Bell and Grocery Outlet sales were executed as pre-sale opportunities during COVID.”
“Single-tenant, QSR assets like Taco Bell are now even more highly coveted by investors in this pandemic environment as they seek cash flow with an essential, name brand tenant over the long-term,” said Luther.
The infill property has a population of more than 284,000 residents and 84,000 employees within a five-mile radius. It is also adjacent to and highly visible from the 15 freeway.
SRS’ National Net Lease Group has continued its explosive growth in the past year, and plans to continue expansion of its teams across the country throughout the remainder of 2020. SRS’ National Net Lease Group and the western region of SRS’ Investment Properties Group successfully completed more than 330 sales to date in 2020 valued at more than $1.35 billion. Of those transactions SRS’ National Net Lease Group (NNLG) has closed 250 transactions since the COVID-19 crisis began. These transactions alone are valued at more than $1 billion. Additionally, the group has more than 500 individual assets under LOI or in escrow and $1.8 billion in assets currently listed for sale. The National Net Lease Group has more than 50 net lease professionals nationwide, all collaborating on one central platform, with leadership, underwriting, and marketing efforts strategically located in Southern California.