Dutch Bros Coffee-15 Yr Abs NNN-Low Rent

Highlights:

• Dutch Bros (NYSE: BROS) is a $12.21B market cap, high-growth, publicly traded coffee chain with a corporate lease guaranty and 912 locations nationwide.
• New 15-year absolute NNN ground lease offers long-term stability, land ownership, and full tenant expense responsibility with 14 years remaining.
• Below market rent of $109,000 offers long-term upside with potential to significantly increase NOI and ROI upon lease expiration.
• New 2024 construction with a prototypical double drive-thru design boosts sales potential and offers strong intrinsic real estate value.
• Growing income stream with 10% rent increases every 5 years enhances ROI and provides inflation protection.
• Prime retail corridor with over 60,000 VPD and strong nearby anchors including schools, residences, and major employers.

Description:

Faris Lee Investments is pleased to offer a STNL freestanding, corporate-guaranteed Dutch Bros
Coffee on an absolute triple net ground lease (land ownership) in Fontana, CA. The newly constructed
property, which opened in September 2024, is secured by a long-term 15-year lease with three
(5-year) renewal options, offering potential total lease terms of up to 30 years. The lease stipulates
10% rental increases every five years, ensuring a growing income stream and a robust hedge against
inflation. This completely passive investment also boasts a double drive-thru, further providing intrinsic
real estate value and customer convenience.
Dutch Bros Coffee, established in 1992, has grown into the third largest coffee chain in the U.S., with
over 900 locations in 18 states. Dutch Bros has been publicly traded on the NYSE (BROS) since 2021
and has demonstrated remarkable growth since, achieving a market capitalization of $12.21 billion as
of February 2025. With an impressive average annual revenue growth rate of 37% since going public,
Dutch Bros achieved over $1.28 billion in revenue for 2024.
The subject property is strategically located fronting a Winco Foods in a bustling retail corridor in
Fontana, CA. Situated at the high-traffic intersection of Foothill Blvd. and Cherry Ave., the location
experiences over 60,000 vehicles per day at the intersection, making it a prime site for retail activity.
The surrounding area boasts strong demographics, including over 144,000 residents and more than
32,000 daytime employees within a 3-mile radius, with an average household income exceeding
$119,000. Co-tenants within the subject property’s shopping center: Winco Supermarket, Chipotle,
Jersey Mike’s, McDonald’s, and Chevron.

Nestled against the San Bernardino Mountains,
Fontana is a modern city that offers its residents
and visitors a wealth of community activities,
a thriving local economy and central access to
major business centers. Founded by Azariel
Blanchard Miller in 1913, it remained essentially
rural until World War II, when entrepreneur
Henry J. Kaiser built a large steel mill in the
area. It is now a regional hub of the trucking
industry, with the east–west Interstate 10 and
State Route 210 crossing the city and Interstate
15 passing diagonally through its northwestern
quadrant. Due to its geographic location,
the City is identified as “…the crossroads of
the Inland Empire”. Per the 2023 census the
population is 215,465, which is an increase of
3.4% since 2020.
It is home to a renovated historic theater, a
municipal park, and the Auto Club Speedway,
which is on the site of the old Kaiser Steel Mill
just outside the city. It has hosted NASCAR
racing annually since 1997 and has a race day
attendance of well over 100,000. Fontana also
hosts the Fontana Days Half Marathon and
5K run. This race is the fastest half-marathon
course in the world.