Popeyes Tenant Overview
Updated: February 6, 2023
Pros
- No landlord responsibilities
- Rental increases in the primary term
Cons
- Non-investment grade credit
- Franchisee operators
Earnings Highlights
Earnings Summary
- Q3 2022 Consolidated system-wide sales grow 13% for Popeyes
- Popeye’s Louisiana Kitchen generated revenues of $164 million in third-quarter 2022, up 14.7% from the prior-year quarter’s levels
- Popeye's Net restaurant growth came in at 8.9% compared with a 5.5% growth reported in the prior-year quarter
Tenant Description
Popeyes Louisiana Kitchen, or Popeyes as it is commonly known, is a chain of fried chicken fast food restaurants.
Popeyes is an attractive net lease investment due to their triple net leases with rental increases and their strong locations. Popeyes, like most QSRs, sign triple net leases that relieve the investor of any landlord responsibilities. The leases will typically feature rental increases in the base term every five years or annually, depending on the lease. Popeyes occupies buildings with strong real estate fundamentals, such as good visibility from a highly trafficked road. Their layout is common among QSR tenants, which makes backfilling the property much easier. Nearly all of the Popeyes locations are franchises, making it critical investors evaluate the financial strength of the restaurant operator.
Popeyes was founded in 1972 in New Orleans. In 2017, Restaurant Brands International (RBI) acquired the entire Popeyes chain. Today, the 2,975 Popeyes restaurants are part of the larger RBI system that totals 24,791 restaurants across 100 countries and US territories.
Average Cap Rate
4.78%
12 mo avg with 10+ yr lease term
Average Property & Lease
Average Sale Price |
$2,937,479 |
NOI |
$141,303 |
$/Square Foot |
$979 - $1,469 |
Building SF |
2,000 - 3,000 |
Lot Size |
0.5 - 1.0 Acres |
Lease Term |
15 - 20 Years |
Escalations |
10% every 5 yrs |
Stock Symbol |
QSR |
Average Cap Rate Trend
Rates reflect last 12 mos, short and long-term
Recent Sales Comps
Kokomo, IN |
4.25% |
Tucson, AZ |
4.53% |
Rome, GA |
5.00% |
Conway, SC |
5.10% |
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