Net Lease News

B+E Weekly Newsletter

January 2 – January 8, 2024

MARKET

EMPLOYERS ADDED A SURPRISING 216,000 JOBS IN DECEMBER | Fortune

• The nation’s employers added a robust 216,000 jobs last month, the latest sign that the American job market remains resilient even in the face of sharply higher interest rates.
• Since March 2022, the Fed has raised its benchmark interest rate 11 times, lifting it to a 22-year high of about 5.4%. 
• Those higher rates have made borrowing costlier for companies and households, but they are on their way toward achieving their goal of conquering inflation.

COMMERCIAL REAL ESTATE FINANCING VOLUME LIKELY TO REBOUND IN 2024 | Commercial Observer

• A wild card in 2024 will be whether lending starts to flow again from banks, big and small, which were largely on the sidelines for much of 2023.
• Banks head into 2024 with heavy loads of CRE stress on their books as evidenced by a December report from the National Bureau of Economic Research showing a 10 percent to 20 percent default rate on loans. Those defaults could equate to $80 billion to $160 billion in losses. 
• Regional banks are poised to fill an important lending void in 2024 as the biggest banks still grapple with trying to strengthen their balance sheets and reduce property holdings while also having to deal with increased regulations.

RETAIL

BANKS NOTCHED $119M IN BRANCH SALE-LEASEBACKS IN 2023 | Globe St. 

• High interest rates turbocharged sale-leaseback deals of STNL assets in 2023, with bank branches completing their highest volume of sale-leasebacks in seven years.
• Bank of the Sierra, a wholly owned subsidiary of Sierra Bancorp, entered into two agreements at the end of last month for the sale and leaseback of 13 branches across central California.
• Bank of America is expanding in Louisville, KY, Birmingham, AL, and Huntsville, AL, with five new branches expected to open in Louisville and one in Birmingham in 2024. BOA also plans to open four additional branches in Birmingham by 2026.

SLIM CHICKENS PLANS TO OPEN OVER 70 LOCATIONS IN 2024 | QSR Magazine

• Slim Chickens made brand history in 2023 by closing out the year with more openings than ever before. Looking ahead, it plans to open over 70 stores in 2024.
• A young brand in its prime, Slim Chickens has experienced 70% restaurant growth in the last three years, opening one store a week, totaling over 250 locations today. The brand has also seen a remarkable 13.6% year-over-year increase in AUV, reaching an impressive $3,864,513.
• Entering 10 new territories, the brand celebrates impressive milestone store openings including introductions in Nevada, Indiana, and Wisconsin, and the University of Arkansas Fort Smith.

TGI FRIDAYS CLOSING 36 U.S. LOCATIONS, SELLS 8 RESTAURANTS TO FORMER CEO | National Restaurant News

• TGI Fridays has agreed to sell eight corporate-owned restaurants in the Northeast to former CEO Ray Blanchette, the company said Wednesday and said it would close 36 underperforming locations domestically.
• The eight stores being sold to Blanchette include six in Massachusetts (Braintree, Boston/Brigham, Everett, Methuen, Millbury, and Stoughton) and two in New Hampshire (Concord and Manchester).
• A company spokesperson said Fridays has 233 domestic restaurants, including 104 corporate stores and 129 franchised units.

AMMORI EQUITY PARTNERS ACQUIRES 19 ZAX CARWASH LOCATIONS | Car Wash

• Zax Auto Wash successfully sold 19 locations to Michigan Wash Co., which was formed by Ammori Equity Partners.
• AEP is a four-wall sales and operations leader focusing on growth-stage companies. Zax Auto Wash is a historical carwash brand, located in Metro Detroit, Michigan, featured on the Top 100 Car Wash Companies in the U.S.
• AEP sees this acquisition as an opportunity to leverage its core competencies that have led to over 30 years of success in customer service businesses.