Northmarq, one of commercial real estate’s leading investment sales brokerage firms, has completed the sale of a single-tenant restaurant located at 1911 Broadway Street in Nashville, TN. The 3,643-square-foot property is leased to Velvet Taco, a growing fast-casual dining concept based out of Plano, Texas. Blaise Bennett of Northmarq represented the seller, a local developer. The 1031 exchange buyer was an entity based out of Glen Allen, Virginia. The asset traded for approximately $7.3 million reflecting a 3.75 percent cap rate.
“Nashville continues to be one of the most sought after commercial real estate markets in the country, and this transaction illustrated that demand with an incredible amount of interest in the property,” said Bennett, Associate Director in Northmarq’s Chicago, Illinois office. “Furthermore, we were able to achieve record-setting pricing due to its infill location and long-term passive net lease structure with annual rent growth.”
Located in the up-and-coming neighborhood of Midtown, the newly built property is surrounded by vibrant nightlife destinations, restaurants, hotels and apartments. The Midtown area attracts tourists, residents and students alike, with its close proximity to Vanderbilt University. The Nashville sale represents the lowest reported cap rate for any Velvet Taco sale in history, in addition to the lowest single-tenant retail cap rate reported in the Nashville metro area during 2021. This is the second Velvet Taco sale brokered by Northmarq in recent months.
“Velvet Taco is a brand investors will want to watch,” added Bennett. “They’ve expanded very rapidly in recent years and are reporting annual sales more than double the average in this segment of the industry. They have plans to open an additional 10 locations in 2022, and I expect investor demand will be very strong for their new locations.”