An affiliate of Red Pine Capital Partners, LLC, a boutique equity and real estate investment firm, acquired a portfolio of four Popeye’s Chicken and Biscuits restaurants from two of the largest Popeye’s mid-atlantic franchisees. The franchisees, Essential Chicken, Inc. and B&T Foods, Inc., together own and operate 30 units in Maryland and Delaware.
Red Pine completed the sale/leaseback financing for four of the units in the greater Baltimore metropolitan area within three weeks of contract. In connection with the financing, each of the properties is encumbered by a 20 year triple-net-lease. The Seller utilized the proceeds to retire existing debt. “Red Pine was the logical choice for us to turn to in connection with our recapitalization,” said H. Clifford Harris, President of Essential Chicken, Inc. “Red Pine’s practical approach, availability of capital in tight credit markets and familiarity with the intersection between structured finance and real estate got our deal done quickly. We are excited about maintaining Red Pine as a long term capital partner,” he added. In addition to the acquisition of the real estate, Red Pine negotiated an option to acquire up to a fifty percent interest in the franchisees.
“We are attracted to the restructuring expertise of the executives at Essential [Chicken, Inc.] and believe that the highly sophisticated back office solutions provided by their affiliate, iprocessonline.com, will synergize well with our existing portfolio” said Michael Federman, a Red Pine principal. “Baltimore is a convenient, central location to which we can relocate the administrative operations for all of our operating businesses,” added Jason Frank, a Red Pine director.
The Popeye’s portfolio complements Red Pine’s quick service restaurant holdings which include, among others, Checkers/Rally’s, KFC and Arby’s.
Red Pine Capital Partners, LLC (redpinecap.com) is a boutique equity and real estate investment firm with a focus on investments in middle-market, consumer-related businesses and real estate projects with equity requirements of up to $60 million. Red Pine and its affiliated companies seek control positions in businesses where long-term capital appreciation can be achieved through the combination of creative management, new strategies and quality corporate assets as well as opportunistic investments in real estate requiring the repositioning of core real estate assets. Red Pine also structures and syndicates special situation bridge loans and interim financing, mezzanine loans and preferred equity loans in connection with real estate and other fixed assets.
Sectors in which Red Pine and its affiliates are active include retail and wholesale businesses, residential and commercial real estate, public storage facilities, manufacturing and distribution, QSR restaurants, gas stations and convenience stores.