The developer of a pair of Sonic Drive-In restaurants built last year has sold both establishments to the local franchisee at a lower rate than what the developer says a typical investor would pay.
The developer, Kent Walker with Donnie Jarreau & Associates, sold the restaurants—located at 505 East Boyd Drive in Baton Rouge and 14620 Greenwell Springs Road in Central—to Sonic franchisee Larry Tucker in separate transactions. Walker says Tucker paid the lower-than-market rate because the two have worked together on several projects over the year and have built a business relationship.
Sold at roughly $58.25 per square foot, the East Boyd restaurant measures about 35,633 square feet and sold for $2,076,205. At about $38.46 per square foot, the Central restaurant measures about 38,195 square feet and sold for a total of $1,469,181. Tucker bought both as REP of South Campus LLC.
Walker says Tucker had the option of either leasing the properties for a period of 20 years or buying them within the first five years of the lease. Tucker was able to buy the properties at the cost of the land and improvements, plus 6%, Walker says. For any other investor, he says, the sales price would require a calculation involving lease payments with a 7.75% increase.
“That’s always the plan when we build with Larry,” Walker says.