The Boulder Group, a net leased investment brokerage firm, has completed the sale of a new construction McDonald’s ground lease located at 2019 Spirit Lake Road in Winter Haven, FL for $1,750,000.
The newly constructed McDonald’s property is located along State Road 540, a primary east-west thoroughfare in the area that experiences traffic counts of approximately 20,000 vehicles per day. The property is benefitted by its location across the street from a CVS and a Publix grocery store. There are 20 years remaining on the McDonald’s ground lease and the buyer closed on the property upon rent commencement.
Randy Blankstein and Jimmy Goodman of The Boulder Group represented the buyer in the transaction, a private family trust in a 1031 exchange. The seller was a Michigan based developer. The new McDonald’s ground lease is for twenty years. There are 10% rental escalations every five years throughout the lease. McDonald’s is an investment grade rated company (S&P: A) and is publicly traded with a market capitalization in excess of $91 billion. “The market for ground leases with investment grade tenants remains highly active as investors are attracted to the typical long term leases with rental escalations.” said Randy Blankstein, President of The Boulder Group. Jimmy Goodman, Partner of The Boulder Group, added, “McDonald’s ground lease properties continue to trade at the most aggressive cap rates in the entire net lease market due to their investment grade rating (S&P: A), rental escalations, and relatively low price point.”