Karcher Lands $31M to Develop New HQ

ANAHEIM, CA-Carl Karcher Enterprises Inc. will develop a new 90,000-sf headquarters office building on its campus here with a $31 million construction loan, according to Holliday Fenoglio Fowler. Karcher, the operator of the Carl's Jr. burger chain and a subsidiary of CKE Restaurants Inc., plans the new building to replace an existing office and distribution facility.

Due for completion in 2008, the three-story office building is 100% preleased to Carl Karcher Enterprises Inc. and will be developed on a 17.5-acre site, according to HFF director Austin Rosen. Rosen and senior managing director Don Curtis arranged the financing on behalf of the property owner, Karcher Partners LP, which is a partnership consisting of members of the Carl Karcher family.

The financing is a three-year, adjustable-rate loan through Merrill Lynch Capital. In addition to providing funds for construction, the loan proceeds will pay off existing debt on the property. The new project marks one of the first office buildings to be built in Anaheim in several years, Rosen points out.

The 17.5-acre site where the new building will be developed also includes a Carl's Jr. Restaurant and 10 acres of land for future development. The property is located near the corner of Harbor Boulevard and the 91 Freeway in Anaheim.

The new building will consist of approximately 85,000 sf of office space and approximately 5,000 sf of storage space, according to public filings by CKE Restaurnats. The initial term of the office lease is 15 years, with options for CKE to extend the lease for two additional five-year terms.

Carpenteria-based CKE Restaurants Inc. operates more than 3,000 locations in 43 states and in 13 countries through its subsidiaries, franchisees and licensees. In addition to Carl's Jr., its brands include the Hardee's, Green Burrito and Red Burrito restaurants.