Four Corners Property Trust, a real estate investment trust engaged in the ownership of high-quality, net-leased restaurant properties, closed on the purchase of five restaurant properties from Washington Prime Group Inc.. This is the second closing of the acquisition previously announced in September 2017. Closing of the remaining properties is expected to be completed throughout the remainder of 2018 based on the timing of parcelization of each respective property, subject to remaining due diligence and customary closing conditions.
The purchase price for the five properties was approximately $9.5 million and represents a capitalization rate consistent with our investment thresholds and past transactions. The leases have a current weighted average remaining term of approximately 8.6 years. Four of the five properties are ground leases (i.e., the tenant built its own building with ownership reverting to the landlord upon lease expiry).
The five restaurant properties consist entirely of outparcels to WPG properties and are well located within highly trafficked retail corridors in Florida, Indiana, Illinois, Ohio, and Texas. All five properties are on out-lots to either Open Air or WPG’s “Tier One Enclosed” properties. None of the five restaurant properties or the adjacent WPG properties are currently encumbered by property-level debt.
The five properties represent five different restaurant brands: Cheddar’s Scratch Kitchen, McDonald’s, Olive Garden, Panera, and Starbucks. Of the five leases, four are with corporate operators and one is with one of the largest Panera franchisees.
Additional detail on all properties acquired from WPG will be disclosed upon the closing of each of the additional properties.
Four Corners Property Trust also announced the acquisition of a corporate operated Buffalo Wild Wings restaurant for $1.7 million from PREIT. The property is located in South Carolina, and is occupied under a triple-net lease with approximately 13.2 years of term remaining and a rent escalation of 2.0% annualized. The transaction was priced at a 6.6% going-in cash cap rate, exclusive of transaction costs.