Palm Springs Restaurant Investment
For Sale
Contact for pricing
450 S Palm Canyon Dr, Palm Springs, CA 92262
Multi-tenant restaurant building in prime downtown Palm Springs location.
Property Size10,490 SF
Lot Size0.80 Acres
Price / SF$448.05
Days on Market215
Property Features for 450 S Palm Canyon Dr
General Information
Standard status
Active
Size
10,490 SF
Lot size
0.80 Acres
Property subtype
Retail
Occupancy
100%
Lease Type
NNN
Net Operating Income
$220,599
Building Details
Year Built
1060
Year Renovated
2022
Buildings
1
Stories
1
Units
2
Tenancy
Multi
Listing Agency:
Coldwell Banker Commercial Lyle & Associates
(760) 772-6400
Listed By:
Brian Ward · License #01212003
Source:
Crexi
Added: Jan 23
Changed: Aug 21
Last Checked: Aug 25 at 11:54PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Coldwell Banker Commercial Lyle & Associates
Investment Insights
Based on property information with market context.
Located on South Palm Canyon Drive in downtown Palm Springs, this multi-tenant restaurant building offers an investment opportunity in a high-demand area. The property, constructed in 1960 and substantially renovated in 2022, features modernized improvements, prominent storefronts, excellent signage, and outdoor patio components. The building has a total area of approximately 10,490 square feet and is situated on a parcel of approximately 34,848 square feet. The property is currently leased to two established restaurant operators under NNN lease structures: Johnny Costa’s Ristorante, and Churrasco Brazilian Steakhouse. The location benefits from high visibility, strong traffic, and walkability within Palm Springs' restaurant and entertainment district. This area has consistent year-round tourism.
Key Highlights
- Premier downtown Palm Springs location on South Palm Canyon Drive.
- Multi‑tenant NNN restaurant investment providing passive income.
- Attractive 6.27% cap rate and $294,624 NOI.
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$132,268
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
2.81%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$2,645,360
$2.6M
Cap Rate 7%
$1,889,543
$1.9M
Cap Rate 9%
$1,469,644
$1.5M
Market Conditions
NOI Build-Up for 10,490 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$188.8K $18.00/SF
− Vacancy
−$12.5K −$1.19/SF
EGI
$176.4K $16.81/SF
− OpEx
−$44.1K −$4.20/SF
NOI
$132.3K $12.61/SF
Area
Riverside County, CA
Vacancy
6.60%
Lease Rate
$18.00 /SF/Yr
Expense Ratio
25.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$2,645,360
Cap Rate 7%
$1,889,543
Cap Rate 9%
$1,469,644
Alternative Uses
Best Use
Specialty Retail
$1.89M
$1.65M – $2.20M
NOI $132,268 @ 7.0% cap · market cap 2.81%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$3.14M
$2.75M – $3.67M
NOI $219,984 @ 7.0% cap · market cap 4.68%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
444
Businesses Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Demographics for 92262, CA
26,593
Population
19,940
Households
1.3
Avg Household Size
54
Median Age
42%
College-Educated
93%
High-School Grad
35.1 sq mi
ZIP Area
758
Density / Sq Mi
$70,514
Median Household Income
$42,940
Median Earnings
$1,420
Median Rent
$600,600
Median Home Value
Market
Vacancy Rate% for Retail in West region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Restaurant - Multi-tenant restaurant building in prime downtown Palm Springs location.
Where is this restaurant located?
The property is located at 450 S Palm Canyon Dr Palm Springs, CA.
What is the asking price?
The asking price for this property is $4,700,000.
What are key features of this property?
This property features: Premier downtown Palm Springs location on South Palm Canyon Drive.; Multi‑tenant NNN restaurant investment providing passive income.; Attractive 6.27% cap rate and $294,624 NOI.
