Hanley Investment Group (HIG) has arranged the sale of a new single-tenant Raising Cane’s Chicken Fingers restaurant in La Habra, California, for $3.96 million. The sale achieved $1,222 per square foot and a 4.04% cap rate, an all-time record-low cap rate in the U.S. for this brand, according to CoStar.
Raising Cane’s is a rapidly growing Louisiana-based restaurant company known for its chicken-finger meals. The property is a 3,239-square-foot building with a drive-thru.
HIG EVP Jeremy McChesney represented the seller, Equitas Investments in Hermosa Beach, California. The buyer, a 1031-exchange buyer also from Hermosa Beach, was represented by Steven Schechter, first VP investments for Marcus & Millichap in Encino, California.
“We generated seven qualified offers on behalf of the seller and closed escrow 15 days after the store officially opened for business, reducing the developer’s carrying costs,” McChesney says. He also notes that the sale price was an attractive price point compared to similar Raising Cane’s currently listed for sale in California and closed escrow within 1 percent of the listed price.
Newly remodeled in 2017 on 0.95 acres, Raising Cane’s is located at 1050 South Beach Boulevard (California State Route 39) in La Habra, a heavily trafficked thoroughfare with more than 45,000 cars per day. The single-tenant, corporate-guaranteed, absolute triple-net lease investment has a new 15-year lease term with rental increases during the primary term. The lease also has four five-year options with 10 percent increases.
“This is a dense, affluent Orange County location with over 178,000 people residing within three miles with household incomes exceeding $104,000,” McChesney says. “The trade area is expected to grow by 6.37 percent by 2020 and includes a recently completed 335-unit luxury apartment community located directly across the street from Raising Cane’s.”
Nation’s Restaurant News magazine ranked Raising Cane’s as the number-one fastest-growing restaurant chain in 2017. Louisiana Restaurant Association ranked Raising Cane’s the Restaurateur of The Year for 2016, and The Dallas Morning News ranked the chain among the Top 10 Places to Work for 2011-2016.