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Four Corners (FCPT) Continues Acquisition of Diverse Properties
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Four Corners Property Trust (FCPT - Free Report) recently made significant acquisitions that are poised to strengthen its portfolio and drive long-term growth. The company has announced the buyout of a WellNow property and a T-Mobile property for $4.0 million, an Optima Dermatology clinic for $9.3 million and two Tire Discounters properties for $5.3 million. These strategic acquisitions not only expand FCPT's presence in the retail and healthcare sectors but also provide a stable income stream and diversification to its portfolio, benefiting the company and its investors.
The WellNow property and the T-Mobile property, located in a strong retail corridor in New York, are occupied under long-term net leases. The transaction has been priced at a cap rate consistent with FCPT's previous transactions. The acquisition of these properties not only adds to FCPT's portfolio but also strengthens its presence in an attractive market, ensuring a favorable return on investment.
In addition to the WellNow and T-Mobile properties, FCPT’s recently acquired Optima Dermatology clinic is situated in a prime retail corridor in New Hampshire. The clinic is occupied under a corporate, triple net lease with around 15 years of residual term. This buyout diversifies FCPT's portfolio and adds a stable, long-term tenant in the healthcare sector.
Furthermore, FCPT has expanded its presence in the automotive service industry with the acquisition of two Tire Discounters properties through a sale-leaseback transaction. Tire Discounters, the largest family-owned and operated automotive service provider in the country, operates more than 200 retail locations and continues to grow. The properties, located in North Carolina and Virginia, are corporate-operated under long-term triple net leases. This acquisition aligns with FCPT's strategy of acquiring high-quality, net-leased properties and adds a strong tenant with a robust nationwide presence.
FCPT has also made a significant acquisition of nine car wash properties for $40 million from a top-five operator through a sale-leaseback arrangement. These properties are strategically located in strong retail corridors across Florida, Indiana, Louisiana, Ohio, Oklahoma and South Carolina. Under a long-term triple net master lease, these corporate-operated sites present a lucrative investment opportunity for FCPT. Although the tenant's brand name remains confidential, this acquisition marks Four Corners’ entry into the car wash space and demonstrates its commitment to exploring diverse investment avenues.
The addition of the WellNow property, T-Mobile property, Optima Dermatology clinic and Tire Discounters properties diversifies FCPT's portfolio, reducing risk and enhancing stability. These acquisitions provide it with a mix of strong tenants, long-term lease agreements and exposure to growing industries. As a result, FCPT is well-positioned to generate consistent rental income and deliver value to shareholders. Moreover, these acquisitions align with the REIT’s strategy of acquiring high-quality, net-leased properties and expanding its presence in attractive markets.
Despite the impressive growth, a high-interest-rate environment poses potential challenges for FCPT. High interest rates could raise the cost of borrowing for future acquisitions, potentially slowing down the company's expansion efforts. However, FCPT's strategy of investing in properties with strong credit operators and long-term leases might provide some buffer against these headwinds.
Shares of this Zacks Rank #3 (Hold) company have declined 4.9% in the past six months, wider than the industry's fall of 3.4%.
The Zacks Consensus Estimate for EastGroup Properties’ current-year funds from operations (FFO) per share has moved marginally north over the past two months to $7.56.
The Zacks Consensus Estimate for Innovative Industrial Properties’ 2023 FFO per share has moved 3.6% upward in the past two months to $8.66.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
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Four Corners (FCPT) Continues Acquisition of Diverse Properties
Four Corners Property Trust (FCPT - Free Report) recently made significant acquisitions that are poised to strengthen its portfolio and drive long-term growth. The company has announced the buyout of a WellNow property and a T-Mobile property for $4.0 million, an Optima Dermatology clinic for $9.3 million and two Tire Discounters properties for $5.3 million. These strategic acquisitions not only expand FCPT's presence in the retail and healthcare sectors but also provide a stable income stream and diversification to its portfolio, benefiting the company and its investors.
The WellNow property and the T-Mobile property, located in a strong retail corridor in New York, are occupied under long-term net leases. The transaction has been priced at a cap rate consistent with FCPT's previous transactions. The acquisition of these properties not only adds to FCPT's portfolio but also strengthens its presence in an attractive market, ensuring a favorable return on investment.
In addition to the WellNow and T-Mobile properties, FCPT’s recently acquired Optima Dermatology clinic is situated in a prime retail corridor in New Hampshire. The clinic is occupied under a corporate, triple net lease with around 15 years of residual term. This buyout diversifies FCPT's portfolio and adds a stable, long-term tenant in the healthcare sector.
Furthermore, FCPT has expanded its presence in the automotive service industry with the acquisition of two Tire Discounters properties through a sale-leaseback transaction. Tire Discounters, the largest family-owned and operated automotive service provider in the country, operates more than 200 retail locations and continues to grow. The properties, located in North Carolina and Virginia, are corporate-operated under long-term triple net leases. This acquisition aligns with FCPT's strategy of acquiring high-quality, net-leased properties and adds a strong tenant with a robust nationwide presence.
FCPT has also made a significant acquisition of nine car wash properties for $40 million from a top-five operator through a sale-leaseback arrangement. These properties are strategically located in strong retail corridors across Florida, Indiana, Louisiana, Ohio, Oklahoma and South Carolina. Under a long-term triple net master lease, these corporate-operated sites present a lucrative investment opportunity for FCPT. Although the tenant's brand name remains confidential, this acquisition marks Four Corners’ entry into the car wash space and demonstrates its commitment to exploring diverse investment avenues.
The addition of the WellNow property, T-Mobile property, Optima Dermatology clinic and Tire Discounters properties diversifies FCPT's portfolio, reducing risk and enhancing stability. These acquisitions provide it with a mix of strong tenants, long-term lease agreements and exposure to growing industries. As a result, FCPT is well-positioned to generate consistent rental income and deliver value to shareholders. Moreover, these acquisitions align with the REIT’s strategy of acquiring high-quality, net-leased properties and expanding its presence in attractive markets.
Despite the impressive growth, a high-interest-rate environment poses potential challenges for FCPT. High interest rates could raise the cost of borrowing for future acquisitions, potentially slowing down the company's expansion efforts. However, FCPT's strategy of investing in properties with strong credit operators and long-term leases might provide some buffer against these headwinds.
Shares of this Zacks Rank #3 (Hold) company have declined 4.9% in the past six months, wider than the industry's fall of 3.4%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are EastGroup Properties (EGP - Free Report) and Innovative Industrial Properties (IIPR - Free Report) , each presently 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 EastGroup Properties’ current-year funds from operations (FFO) per share has moved marginally north over the past two months to $7.56.
The Zacks Consensus Estimate for Innovative Industrial Properties’ 2023 FFO per share has moved 3.6% upward in the past two months to $8.66.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.