Sales of Chick-fil-A Drive-Thru, Quick Quack Car Wash and AT&T/Spectrum at Palm Desert’s Monterey Crossing total nearly $16 million
PALM DESERT, Calif. — Hanley Investment Group Real Estate Advisors, a nationally recognized real estate brokerage and advisory firm specializing in retail property sales, announced today that the firm has completed the sales of three new construction retail pad properties at the newly developed Monterey Crossing shopping center in Palm Desert.
The trio of sales at the shopping center, which is located at the Interstate 10 and Monterey Avenue interchange, were to three separate buyers at record-low cap rates, according to HIG.
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Hanley Investment Group’s Executive Vice Presidents Bill Asher and Jeff Lefko represented the developer and seller, Fountainhead Development of Newport Beach, California, in all three transactions. The combined value of these three sales was more than $15.7 million and included two, brand new, single-tenant ground leased pads to Chick-fil-A (Drive-Thru) and Quick Quack Car Wash along with a two-tenant pad building occupied by AT&T and Spectrum.
Single-Tenant Chick-fil-A Drive-Thru
Asher and Lefko arranged the sale of a new construction, single-tenant Chick-fil-A at 73070 Dinah Shore Drive. The 4,738-square-foot Chick-fil-A building with a double-lane drive-thru sits on 1.63 acres. The store is scheduled to open in the first half of 2022. The sale price was $7,246,000 for the absolute triple-net ground lease, which represented a record-low cap rate of 3.45%.
“We procured an all-cash 1031 exchange buyer over the asking price, prior to formally marketing the property,” Asher said. “We were able to procure a buyer on a pre-sale basis, closing escrow prior to completion of construction and the tenant open for business and paying rent. The sale represented one of the record-low cap rates for a new Chick-fil-A nationwide.”
The buyer, a private investor from San Diego, California, was represented by Bruce Bailey of The Bailey Group of Los Angeles and Tim Genske of CBRE in Glendale, California.
Atlanta-based Chick-fil-A has more than 2,600 restaurants in 47 states, Washington, D.C., and Canada, and has been named “America’s Favorite Restaurant Chain” for seven years in a row by the American Customer Satisfaction Index.
Single-Tenant Quick Quack Car Wash
Asher and Lefko arranged the sale of a new construction, single-tenant Quick Quack Car Wash at 73320 Dinah Shore Drive. The 3,436-square-foot express car wash building sits on 1.22 acres. The store is scheduled to open in the first half of 2022. The sale price was $3,010,000 for the absolute triple-net ground lease, which represented a record-low cap rate of 4.75%.
“Similar to the Chick-fil-A sale, we procured an all-cash 1031 exchange buyer at the asking price, prior to formally marketing the property,” Asher said. “We were able to procure a buyer on a pre-sale basis, closing escrow prior to completion of construction and the tenant open for business and paying rent. The sale represented one of the record-low cap rates for a Quick Quack Car Wash nationwide.”
The buyer, a private investor based in the Boise, Idaho metro area, was represented by Asher and Lefko.
Headquartered in Roseville, California, Quick Quack now owns and operates over 140 locations across Arizona, California, Colorado, Texas, and Utah, with continued growth throughout these regions. Professional Carwashing & Detailing Magazine ranked the chain #4 in its list of the “Top 50 Conveyor Car Washes” in 2020 and Phoenix New Times ranked it #1 “Best Car Wash in 2020.”
According to Asher, express car washes offer a service-based, internet-resistant and recession-proof investment, which is poised for long-term success. The car wash business is a highly segmented $15 billion industry that is growing at 3.2% annually.
Two-Tenant AT&T and Spectrum
Asher and Lefko arranged the sale of a new construction, two-tenant pad building occupied by AT&T and Spectrum at 73170 Dinah Shore Drive. The 6,186-square-foot retail pad building, built in 2021, sits on 0.76 acres. The sale price was $5,469,578, representing a record-low cap rate of 4.99%.
“We generated multiple offers within the first two weeks of formally marketing the property,” said Asher. “We created a competitive bidding process that helped secure an all-cash 1031 exchange buyer above the asking price with a two-week, year-end closing. The sale is a record-low cap rate for a two-tenant retail pad in the Inland Empire.”
AT&T (NYSE: T) is the world’s largest telecom company by revenue and is also the second-largest provider of mobile telephone services and the largest provider of fixed telephone services in the United States. The operator, Spearhead Mobility, is one of the fastest-growing AT&T authorized retailers with 82 stores and counting across nine states. Spectrum is a subsidiary of Charter Communications, Inc. (NASDAQ: CHTR), a leading broadband connectivity company and cable operator serving more than 31 million customers in 41 states through its Spectrum brand. The company operates 687 Spectrum retail locations across 39 states in the U.S. Spectrum was ranked #2 “Best Cable Internet Providers of 2021” by U.S. News & World Report.
Monterey Crossing is strategically located at the signalized intersection of Monterey Avenue and Interstate 10 freeway, one of the most centrally located and heavily visited interchanges (110,000 cars per day) in the Desert Cities area of Southern California and a primary east/west arterial connecting to Los Angeles to San Bernardino County, Riverside County and Phoenix, Arizona. Monterey Avenue (37,000 cars per day) is the major north/south connector between the freeway, resorts and high-income communities of Palm Desert, Rancho Mirage and Cathedral City.
Asher notes that a single-tenant Habit Burger Restaurant also occupies the newly developed Monterey Crossing and is in the process of being sold. Fountainhead is currently developing additional single-tenant pads and multi-tenant buildings in the first phase of the project in addition to a second phase of the shopping center, which combined will ultimately feature 17 acres of best-in-class retail.
Monterey Crossing also benefits from freeway-visible pylon signage and is the first Palm Desert center to be approved for freeway signage, according to Asher.
National tenants located at the intersection of Monterey Avenue and Interstate 10 include Costco, Home Depot, Kohl’s, Sam’s Club, Walmart, 99 Cents Only, Ashley HomeStore, JOANN Fabrics and Crafts, PetSmart and Regal Cinemas.
Palm Desert is the geographic center of the Coachella Valley, a fast-growing region of Southern California. Within a three-mile radius of Monterey Crossing, the population increased by 53% between 2000 and 2020 and is projected to grow an additional 7.4% by 2025. The average household income is currently $106,000. There are more than 4,500 new residential units planned or under construction within a 2.5-mile radius of Monterey Crossing.
“In 2022, we anticipate more developers and shopping center owners seeking to implement a break-up sale strategy to capitalize on the high demand for single-tenant and multi-tenant retail pad product at premium pricing,” said Asher.
Hanley Investment Group has sold more than $403 million in retail properties in the Inland Empire in the last 36 months.
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About Hanley Investment Group
Hanley Investment Group Real Estate Advisors is a real estate brokerage and advisory services company with an $8.9 billion transaction track record that specializes in the sale of retail properties nationwide. Their expertise, proven track record, and unwavering dedication to putting clients’ needs first set us apart in the industry. Hanley Investment Group creates value by delivering exceptional results through the use of property-specific marketing strategies, cutting-edge technology, and local market knowledge. Their nationwide relationships with investors, developers, institutions, franchisees, brokers, and 1031 exchange buyers are unparalleled in the industry, translating into maximum exposure and pricing for each property. With unmatched service, Hanley Investment Group has redefined the experience of selling retail investment properties. For more information, visit www.hanleyinvestment.com.
Submitted by Monaghan Communications Inc.
Contact the writer: [email protected]
Trevor Montgomery, 50, moved in 2017 to the Intermountain area of Shasta County from Riverside County and runs Riverside County News Source (RCNS) and Shasta County News Source (SCNS).
Additionally, he writes or has written for several other news organizations; including Riverside County based newspapers Valley News, Valley Chronicle, Anza Valley Outlook, and Hemet & San Jacinto Chronicle; the Bonsall/Fallbrook Village News in San Diego County; and Mountain Echo in Shasta County. He is also a regular contributor to Thin Blue Line TV and Law Enforcement News Network and has had his stories featured on news stations throughout the Southern California and North State regions.
Trevor spent 10 years in the U.S. Army as an Orthopedic Specialist before joining the Riverside County Sheriff’s Department in 1998. He was medically retired after losing his leg, breaking his back, and suffering both spinal cord and brain injuries in an off-duty accident. (Click here to see segment of Discovery Channel documentary of Trevor’s accident.)
During his time with the sheriff’s department, Trevor worked at several different stations; including Robert Presley Detention Center, Southwest Station in Temecula, Hemet/Valle Vista Station, Ben Clark Public Safety Training Center, and Lake Elsinore Station; along with other locations.
Trevor’s assignments included Corrections, Patrol, DUI Enforcement, Boat and Personal Water-Craft based Lake Patrol, Off-Road Vehicle Enforcement, Problem Oriented Policing Team, and Personnel/Background Investigations. He finished his career while working as a Sex Crimes and Child Abuse Investigator and was a court-designated expert in child abuse and child sex-related crimes.
Trevor has been married for more than 30 years and was a foster parent to more than 60 children over 13 years. He is now an adoptive parent and his “fluid family” includes 13 children and 18 grandchildren.