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Four Corners (FCPT) Expands Portfolio, Buys $3M Texas Asset
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Four Corners Property Trust (FCPT - Free Report) recently acquired a Brookshire Brothers grocery store property located in a strong retail corridor in Texas for $3 million. The move aligns with the FCPT’s portfolio-expansion efforts, with real estate leased to strong credit operators.
Shares of FCPT gained 1.04% on May 5 regular trading session on the NYSE following the announcement.
The property is occupied under a long-term, triple net lease with around four years of term remaining. Priced at a cap rate of 6.8%, excluding transaction costs, the buyout seems a strategic fit for FCPT. The portfolio is likely to generate steady revenues over the long term.
Of late, this real estate investment trust (REIT), mainly engaged in the ownership and acquisition of high-quality, net-leased restaurant and retail properties, has been on an acquisition spree.
This April, the company announced the acquisition of a NAPA Auto Parts property located in a strong retail corridor in Nebraska for $1.3 million. The property, occupied under a net lease, has roughly two years of term remaining and was priced at a cap rate of 7%, excluding transaction costs.
In a similar move, in April, FCPT completed the buyout of an Arby property, located in a highly trafficked corridor in Kentucky, for $1.2 million. The property is corporate-operated under a net lease with approximately five years of term remaining and was priced at a cap rate of 6.7%, excluding transaction costs.
Further, in the same month, the company purchased a VillageMD property in a highly trafficked corridor in Illinois for $2.6 million. It also concluded the buyout of a HCA Emergency Room for $4.6 million and a newly constructed WellNow Urgent Care property for $2.4 million. Both properties are located in strong retail corridors of Texas and Indiana, respectively.
Also, as part of its capital-recycling efforts, FCPT announced the disposition of a Burger King property in Alabama for $2.4 million in February 2023 and the selloff of a Red Lobster property in North Dakota for $4.7 million in January 2023. The company plans to redeploy the proceeds into new investment prospects in sync with its thresholds.
The buyouts seem a strategic fit for Four Corners and are likely to generate steady revenues over the long term. However, increasing interest rates and macroeconomic uncertainty are raising concerns.
FCPT currently carries a Zacks Rank #4 (Sell).
Its shares have lost 0.9% in the past six months against the real estate market’s growth of 1.8%.
Image: Bigstock
Four Corners (FCPT) Expands Portfolio, Buys $3M Texas Asset
Four Corners Property Trust (FCPT - Free Report) recently acquired a Brookshire Brothers grocery store property located in a strong retail corridor in Texas for $3 million. The move aligns with the FCPT’s portfolio-expansion efforts, with real estate leased to strong credit operators.
Shares of FCPT gained 1.04% on May 5 regular trading session on the NYSE following the announcement.
The property is occupied under a long-term, triple net lease with around four years of term remaining. Priced at a cap rate of 6.8%, excluding transaction costs, the buyout seems a strategic fit for FCPT. The portfolio is likely to generate steady revenues over the long term.
Of late, this real estate investment trust (REIT), mainly engaged in the ownership and acquisition of high-quality, net-leased restaurant and retail properties, has been on an acquisition spree.
This April, the company announced the acquisition of a NAPA Auto Parts property located in a strong retail corridor in Nebraska for $1.3 million. The property, occupied under a net lease, has roughly two years of term remaining and was priced at a cap rate of 7%, excluding transaction costs.
In a similar move, in April, FCPT completed the buyout of an Arby property, located in a highly trafficked corridor in Kentucky, for $1.2 million. The property is corporate-operated under a net lease with approximately five years of term remaining and was priced at a cap rate of 6.7%, excluding transaction costs.
Further, in the same month, the company purchased a VillageMD property in a highly trafficked corridor in Illinois for $2.6 million. It also concluded the buyout of a HCA Emergency Room for $4.6 million and a newly constructed WellNow Urgent Care property for $2.4 million. Both properties are located in strong retail corridors of Texas and Indiana, respectively.
Also, as part of its capital-recycling efforts, FCPT announced the disposition of a Burger King property in Alabama for $2.4 million in February 2023 and the selloff of a Red Lobster property in North Dakota for $4.7 million in January 2023. The company plans to redeploy the proceeds into new investment prospects in sync with its thresholds.
The buyouts seem a strategic fit for Four Corners and are likely to generate steady revenues over the long term. However, increasing interest rates and macroeconomic uncertainty are raising concerns.
FCPT currently carries a Zacks Rank #4 (Sell).
Its shares have lost 0.9% in the past six months against the real estate market’s growth of 1.8%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are VICI Properties (VICI - Free Report) , Rexford Industrial Realty (REXR - Free Report) and Stag Industrial (STAG - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for VICI Properties’ current-year funds from operations (FFO) per share is pegged at $2.13.
The Zacks Consensus Estimate for Rexford Industrial’s 2023 FFO per share is pegged at $2.19.
The Zacks Consensus Estimate for Stag Industrial’s ongoing year’s FFO per share is pegged at $2.25.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.