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Four Corners (FCPT) Boosts Portfolio With New Mexico Buyout
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Four Corners Property Trust (FCPT - Free Report) recently acquired an Aspen Dental property located in a strong retail corridor in New Mexico for $1.9 million. The move is in line with the company’s portfolio-expansion efforts, with real estate leased to strong credit operators.
Reflecting broader market concerns, shares of FCPT declined marginally on Mar 15 normal trading session on the NYSE.
The property is corporate-operated and is priced at a cap rate in range with the prior FCPT transactions. The portfolio is likely to generate steady revenues over the long term, making FCPT’s latest buyout a strategic fit.
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.
Recently, FCPT shelled out $2.1 million to acquire a WellNow Urgent Care property in a strong retail corridor in New York. The transaction of this newly constructed property was priced at a cap rate in the range of previous FCPT transactions.
Earlier in March 2023, FCPT closed the acquisition of a NAPA Auto Parts property in a strong retail corridor in Indiana for $935,000. The transaction of this property, which is occupied under a net lease with roughly four years of the residual term, was priced at a 6.9% cap rate, exclusive of transaction costs.
Moreover, in February 2023, Four Corners shelled out $2.2 million to acquire a Heartland Dental property located in a strong retail corridor in South Carolina. The property is corporate-operated under a long-term net lease with roughly seven years of the residual term. Exclusive of transaction costs, the deal was priced at a 7.0% cap rate on rent as of the closing date.
In the same month, the company acquired two Caliber Collision properties for $3.8 million, located in highly trafficked corridors in Illinois. The properties are corporate-operated under long-term net leases with seven years of the residual term. The transaction was priced at a cap rate of 6.7% on rent as of the closing date, excluding the transaction costs.
Further, 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, rate hikes, inflation and macroeconomic uncertainty are raising concerns.
FCPT currently carries a Zacks Rank #3 (Hold). Its shares have gained 3.6% in the quarter-to-date period against the real estate market’s fall of 0.7%.
Image: Bigstock
Four Corners (FCPT) Boosts Portfolio With New Mexico Buyout
Four Corners Property Trust (FCPT - Free Report) recently acquired an Aspen Dental property located in a strong retail corridor in New Mexico for $1.9 million. The move is in line with the company’s portfolio-expansion efforts, with real estate leased to strong credit operators.
Reflecting broader market concerns, shares of FCPT declined marginally on Mar 15 normal trading session on the NYSE.
The property is corporate-operated and is priced at a cap rate in range with the prior FCPT transactions. The portfolio is likely to generate steady revenues over the long term, making FCPT’s latest buyout a strategic fit.
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.
Recently, FCPT shelled out $2.1 million to acquire a WellNow Urgent Care property in a strong retail corridor in New York. The transaction of this newly constructed property was priced at a cap rate in the range of previous FCPT transactions.
Earlier in March 2023, FCPT closed the acquisition of a NAPA Auto Parts property in a strong retail corridor in Indiana for $935,000. The transaction of this property, which is occupied under a net lease with roughly four years of the residual term, was priced at a 6.9% cap rate, exclusive of transaction costs.
Moreover, in February 2023, Four Corners shelled out $2.2 million to acquire a Heartland Dental property located in a strong retail corridor in South Carolina. The property is corporate-operated under a long-term net lease with roughly seven years of the residual term. Exclusive of transaction costs, the deal was priced at a 7.0% cap rate on rent as of the closing date.
In the same month, the company acquired two Caliber Collision properties for $3.8 million, located in highly trafficked corridors in Illinois. The properties are corporate-operated under long-term net leases with seven years of the residual term. The transaction was priced at a cap rate of 6.7% on rent as of the closing date, excluding the transaction costs.
Further, 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, rate hikes, inflation and macroeconomic uncertainty are raising concerns.
FCPT currently carries a Zacks Rank #3 (Hold). Its shares have gained 3.6% in the quarter-to-date period against the real estate market’s fall of 0.7%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are Alexandria Real Estate Equities (ARE - Free Report) , Terreno Realty (TRNO - Free Report) , each currently carrying a Zacks Rank #2 (Buy) and Service Properties Trust (SVC - Free Report) , currently carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Alexandria Real Estate’s 2023 FFO per share stands at $8.95.
The Zacks Consensus Estimate for Terreno Realty’s current-year FFO per share is pegged at $2.17.
The Zacks Consensus Estimate for Service Properties Trust’s 2023 FFO per share is pegged at $1.89.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.