QSR Net Lease Investing: McDonald's, Chick-fil-A, Starbucks, and the Cap Rate Stack

Why QSR Sits at the Top of the Stack Quick service restaurant net lease properties trade at the tightest cap rates in all of commercial real estate. There are three reasons: 1. Decades of operating history — the top brands have weathered every recession and emerged stronger 2. Ground lease optionality — many QSR deals are land-only with tenant-built improvements 3. Re-tenant velocity — well-located QSR pads re-tenant in months, not years The result is a category where 4-cap ground leases trade hands routinely. The Cap Rate Stack Approximate 2026 ranges for stabilized corporate-guaranteed product: - McDonald's ground lease, 20-year primary: 3.75%–4.50% - Chick-fil-A ground lease: 4.00%–4.75% - Starbucks (corporate) drive-thru: 4.75%–5.50% - Chipotle corporate: 4.75%–5.50% - Raising Cane's: 4.50%–5.25% - Taco Bell corporate: 5.50%–6.25% - Wendy's corporate: 5.75%–6.50% - Franchisee QSR (most brands): 6.00%–7.50% Corporate vs Franchisee — The Critical Distinction Half the deals on the market are actually franchisee-guaranteed, not corporate-guaranteed. The difference is enormous: - Corporate guarantee: Backed by McDonald's USA LLC, Yum Brands, Starbucks Corp, etc. Trades at premium cap rates. - Franchisee guarantee: Backed by the operating LLC of a multi-unit franchisee. Trades 100–250 bps wider. For franchisee deals, always request: - Audited or reviewed financials of the guarantor entity - 4-wall EBITDAR for the specific unit - Franchisee's total unit count and geographic concentration - Royalty and marketing fee structure - Lender's franchisee approval status with the brand Ground Lease vs Fee Simple A ground lease means the tenant owns the building and ground-leases the land from the landlord. Key implications: - Lower cap rates (you're buying land only, the safest position) - Tenant funds and maintains all improvements - Reversion value at lease end — building reverts to landlord - Smaller depreciation basis (no building to depreciate) A fee simple deal includes both land and building. Higher cap rates, bigger depreciation basis, and more leverage potential. For 1031 exchangers with depreciation as a primary motive, fee simple often beats ground lease despite the cap rate spread, because of cost segregation upside. Site Selection Criteria The brand can be perfect and the deal can still underperform if the real estate is wrong. The QSR site checklist: - 30,000+ VPD on the primary access road - Hard corner or signalized access with a left-in lane - Visibility from both directions with clear signage rights - Drive-thru stacking for at least 8 cars - Co-tenancy that drives traffic (grocery anchor, big box) - Daytime population of 40,000+ within 3 miles for QSR; 25,000+ for coffee Lease Structure Watch List - Rent bumps — 10% every 5 years is standard; flat rent is a red flag - Percentage rent — uncommon in modern QSR but check older leases - Option periods — bumps must continue into options - Subordination — most QSR leases are SNDA-friendly; verify before financing - Use restrictions — narrow use clauses limit re-tenant options Finding QSR Deals Net Lease World's <a href="/deals">marketplace</a> aggregates QSR net lease inventory across all major brands. Filter by tenant for live <a href="/nnn/mcdonalds">McDonald's</a>, <a href="/nnn/chick-fil-a">Chick-fil-A</a>, <a href="/nnn/starbucks">Starbucks</a>, and <a href="/nnn/raising-canes">Raising Cane's</a> opportunities. FAQ Why does Chick-fil-A trade at premium cap rates? Average unit volumes ($8M+) are roughly 3x the QSR average, the brand declines unprofitable units almost never, and franchisee selection is unusually rigorous. The credit risk profile is closer to McDonald's than to a typical franchise. Are franchisee QSR deals worth the spread? Sometimes. The right multi-unit franchisee with strong unit economics and a 20-year track record can be a great deal. Diligence matters. Can I get non-recourse financing on QSR? Yes, especially on corporate-guaranteed deals above $1.5M.