Four Corners Property Trust FCPT recently acquired land from Aspen Dental located in a strong retail corridor in New Mexico for $1.9 million. The move is consistent with the company’s portfolio expansion efforts, with properties being leased to strong credit providers.
FCPT shares, reflecting general market concerns, fell slightly on March 15 in normal trading on the NYSE.
The property is corporate operated and priced in line with previous FCPT transactions. The portfolio should generate stable income over the long term, making the recent acquisition of FCPT a strategic addition.
Recently, this real estate investment trust (REIT), which is primarily concerned with owning and acquiring quality net-leased restaurant and retail properties, has been on an acquisition spree.
FCPT recently spent $2.1 million to acquire a WellNow Urgent Care property in a strong New York retail corridor. The transaction price for this newly constructed property was in line with previous FCPT transactions.
In early March 2023, FCPT completed the acquisition of a property from NAPA Auto Parts in a strong retail corridor in Indiana for $935,000. The transaction for this property, which is occupied as part of a net rental agreement with a remaining term of around four years, was priced at a cap rate of 6.9% excluding transaction costs.
Additionally, in February 2023, Four Corners spent $2.2 million to acquire a Heartland Dental property located in a strong retail corridor in South Carolina. The property is operated under company law as part of a long-term net rental agreement with a remaining term of around seven years. Less transaction costs, the deal was valued at the closing date with a rent cap of 7.0%.
In the same month, the company acquired two properties from Caliber Collision located in high-traffic corridors in Illinois for $3.8 million. The properties are operated under company law within the framework of long-term net rental agreements with a remaining term of seven years. The transaction was priced at a cap rate of 6.7% on closing date rent excluding transaction costs.
Additionally, as part of its capital recycling efforts, FCPT announced the sale of a Burger King property in Alabama for $2.4 million in February 2023 and the sale of a Red Lobster property in North Dakota for $4.7 million in January 2023 at. The Company plans to reallocate proceeds to new investment opportunities in line with its thresholds.
The acquisitions appear to be a strategic fit for Four Corners and should generate stable revenue over the long term. However, interest rate hikes, inflation and macroeconomic uncertainty are concerns.
FCPT currently carries a Zacks rank #3 (hold). Its shares are up 3.6% for the quarter, while the real estate market is down 0.7%.
Image source: Zacks Investment Research
Stocks to consider
Some better rated stocks from the REIT sector are Alexandria Real Estate Stocks ARE, Terreno real estate TRNO, who currently have a Zacks Rank #2 (Buy) and trust service properties SVC, who currently carries a Zacks rank #1 (Strong Buy). You can see the full list of today’s Zacks #1 Rank stocks can be found here.
The Zacks Consensus estimate for Alexandria Real Estate’s FFO per share in 2023 is $8.95.
The Zacks consensus estimate for Terreno Realty’s year-to-date FFO per share is $2.17.
The Zacks Consensus estimate for Service Properties Trust’s FFO per share in 2023 is priced at $1.89.
Note: Everything related to earnings in this summary represents FFO — a widely used metric to measure REITs’ performance.
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Four Corners Property Trust, Inc. (FCPT): Free Stock Research Report
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