PARKER, CO – [August 23, 2022] – Blue West Capital has completed the sale of a single tenant Freddy’s Frozen Custard & Steakburgers sale leaseback property located at 18424 Cottonwood Drive in Parker, CO for $2,353,000. The property sold for a 4.25% cap rate, the lowest cap rate ever recorded nationally for a Freddy’s property according to CoStar. This is the third Freddy’s property sold by Blue West Capital within the past week.
On August 16, 2022, Blue West Capital sold two Freddy’s properties located at 11140 S Twenty Mile Road in Parker, CO and 2300 Coalton Road in Broomfield, CO. Both properties sold for a 4.30% cap rate, which was the lowest cap rate ever recorded for a Freddy’s property at the time of sale.
Zach Wright and Brandon Wright, of Blue West Capital, exclusively represented the seller in this cap rate record transaction. The seller was a Freddy’s franchisee based in Denver and the Midwest. The repeat purchaser was a private investor based in Southern California.
The Freddy’s Frozen Custard & Steakburgers property features a new fifteen-year triple net lease with no landlord responsibilities. The lease includes 10% rental increases every five years. The lease is guaranteed by an entity encompassing all sixteen Freddy’s locations in the Denver MSA. Freddy’s has approximately 450 locations and was the eighth Fastest Growing Chain in the U.S., according to Technomic.
The property is a strategically positioned outparcel to a Costco and Trader Joe’s anchored development and is located along South Parker Road. The surrounding area is affluent with average annual household incomes in excess of $141,000.
“Well-located single tenant properties with long-term leases in the Denver MSA are in limited supply. We continue to see strong demand from investors nationally for these properties. We received substantial investor interest in this Freddy’s property and were able to line up a deal with a repeat purchaser prior to publicly marketing,” stated Zach Wright, Director & Partner.