Chili's Restaurant NNN Ground
For Sale
Contact for pricing
1292 East Prosperity Ave, Tulare, CA 93274
Chili's NNN ground lease with 11 years remaining.
Property Size6,102 SF
Price / SF$405.60
Days on Market3770
Property Features for 1292 East Prosperity Ave
General Information
Standard status
Active
Size
6,102 SF
Property subtype
Retail
Lease Type
Absolute Net
Net Operating Income
$105,875
Building Details
Year Built
2006
Tenancy
Single
Listing Agency:
Colliers - Los Angeles - Orange County, California
Listed By:
Eric Carlton · License #CA 01809955
(949) 724-5561
Source:
Crexi
Added: May 12, 2016
Changed: Sep 2
Last Checked: Sep 5 at 6:42AM
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 Colliers - Los Angeles - Orange County, California
Investment Insights
Based on property information with market context.
This offering presents an opportunity to acquire a Chili’s restaurant operating under a long-term, absolute NNN ground lease. The property is positioned as an outparcel to a Walmart. The lease has approximately 11 years remaining, with four 5-year options. The lease includes fixed rental escalations of 10% every 5 years, with the next increase scheduled for February 2022, followed by an approximate 35% increase in rent at the first option. The property benefits from frontage on East Prosperity Avenue, which experiences approximately 34,550 vehicles per day. It is adjacent to Monte Vista Shopping Center, a 20-acre power center featuring the Galaxy Movie Theater and various national retailers. The location is near Highway 99. Surrounding retailers include Lowe’s, Chase Bank, McDonald’s, Panda Express, Home Depot, CVS, and Starbucks. The property is located in Tulare, CA. The building size is 6,102 square feet. Brinker International, Inc., the parent company of Chili’s, has a Standard & Poor rating of BBB-.
Key Highlights
- Absolute NNN ground lease with approximately 11 years remaining, providing a passive income stream.
- Located as an outparcel to a successful Walmart, benefiting from its customer traffic.
- Fixed rental escalations, including a significant increase at the first option.
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
$129,744
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
5.24%
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%
$2,594,880
$2.6M
Cap Rate 7%
$1,853,486
$1.9M
Cap Rate 9%
$1,441,600
$1.4M
Market Conditions
NOI Build-Up for 6,102 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
$183.1K $30.00/SF
− Vacancy
−$10.1K −$1.65/SF
EGI
$173.0K $28.35/SF
− OpEx
−$43.2K −$7.09/SF
NOI
$129.7K $21.26/SF
Area
Tulare County, CA
Vacancy
5.50%
Lease Rate
$30.00 /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%
$2,594,880
Cap Rate 7%
$1,853,486
Cap Rate 9%
$1,441,600
Alternative Uses
Best Use
Specialty Retail
$1.85M
$1.62M – $2.16M
NOI $129,744 @ 7.0% cap · market cap 5.24%
Second Best
—
—
no second resolved use
Theoretical Best
—
—
same as Best Use
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
906
Businesses Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Demographics for 93274, CA
78,493
Population
24,493
Households
3.2
Avg Household Size
31
Median Age
11%
College-Educated
75%
High-School Grad
219.2 sq mi
ZIP Area
358
Density / Sq Mi
$69,905
Median Household Income
$37,434
Median Earnings
$1,334
Median Rent
$300,900
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?
Conventional restaurant - Chili's NNN ground lease with 11 years remaining.
Where is this conventional restaurant located?
The property is located at 1292 East Prosperity Ave Tulare, CA.
What is the asking price?
The asking price for this property is $2,475,000.
What are key features of this property?
This property features: Absolute NNN ground lease with approximately 11 years remaining, providing a passive income stream.; Located as an outparcel to a successful Walmart, benefiting from its customer traffic.; Fixed rental escalations, including a significant increase at the first option.
