Freestanding McDonald’s Deal Gives Buyer Two for One Retail Win

WEST PALM BEACH, FL-In a rare deal, a free-standing McDonald’s has traded hands. The $2.6 million acquisition includes a long-term ground lease and a vacant 3,750-square-foot retail building.

CBRE represented the buyer, a local private investor doing business under the name Okeechobee 9847 LLC. The seller, Iberiabank, represented itself.

The bank had taken ownership of the land and assets through a foreclosure. Although CBRE declined to disclose the cap rate, the CBRE vice president William Strauss confirmed that the property sold at market value.

“The property was originally developed by a California investor and he ended up losing the property to the lender,” Strauss, a member of CBRE's Private Capital Group in South Florida, tells GlobeSt.com. “This transaction reflects the significant demand for single-tenant investment grade properties with secure leases.”

Located at 9835-9847 Okeechobee Boulevard, the vacant retail building was constructed in 2007 and is located adjacent to the Baywinds residential community. Specifically, the asset is on northeast corner of Okeechobee Boulevard and State Road 7, a major intersection in Palm Beach County.

“At the Northwest corner of the intersection there is a relatively new Super Target,” Strauss says. “Adjacent to the property there’s a freestanding Wells Fargo bank branch, a Sun Trust bank branch, and a Walgreens.”

The buyer plans to lease the vacant retail building, adding long-term value to the property. No tenant has ever occupied the vacant building. The buyer plans to build out to the interior for the tenant once a lease is signed.

Strauss is bullish on fourth quarter retail in South Florida. “This year has generally been a lot more active than last year,” he says. “This quarter has been very busy. I have four transactions alone that the buyers are pushing for year-end closing.”

The Palm Beach County retail market is 91.1% occupied, revealing a steady improvement since 2009, according to CBRE. Compared to this time last year, the market experienced a decrease in vacancy of 1.4 percentage points. CBRE predicts continued signs of a recovery will aid in the improvement in vacancy rates at neighborhood and community centers.