Taco Bell Tenant Overview

Net Lease Advisor Tenant Taco Bell


  • Higher cap rates available
  • Engaged in heavy advertising to improve brand image and market penetration
  • Often new favorable NNN leases with good increases


  • Non-investment grade credit
  • Must look closely at performance of franchisor across all locations
  • Not all leases require sales reporting

Earnings Highlights

Earnings Summary
  • Taco Bell Division opened 98 gross new restaurants in 16 countries.
  • Taco Bell U.S. system sales grew 8% and Taco Bell International system sales grew 26%.
  • Worldwide system sales grew 7%, excluding foreign currency translation, with Taco Bell at 9%

Tenant Description

Taco Bell is a Mexican-inspired quick service restaurant.

Taco Bell typically features a 2,000 - 2,600 square foot building with a drive-thru window, situated on 0.5 - 1.2 acre of land. It is important to note that Taco Bell franchises the majority of its locations. There are a number of various lease agreements and guarantors operating under the Taco Bell banner. As a result, lease terms vary as do cap rates based on the size and strength of the operator and sales at a particular location. The most common lease term is 20 years with four (4) five-year options.

Glen Bell opens his first Taco Bell restaurant in Downey, CA, serving what his customers called "Tay-Kohs." In 1978, Glen sold 868 Taco Bell restaurants to PepsiCo Inc., who then announced the spin-off of its quick service restaurants - KFC, Taco Bell, and Pizza Hut now known as Yum! Brands, Inc.

Taco Bell serves made-to-order and customizable tacos and burritos, among other choices, and is the first QSR restaurant to offer American Vegetarian Association (AVA)-certified menu items. Taco Bell and it's more than 350 franchise organizations proudly operate 7,000 restaurants across the world.

As the leading Mexican-inspired quick service restaurant brand, Taco Bell plans to have 8,000 restaurants by the year 2023 which they anticipate will add an estimated 100,000 jobs nationwide.

Average Cap Rate
Trailing 12-month average
Average Property & Lease
Average Sale Price $2,047,977
NOI $112,716
$/Square Foot $788 - $931
Building SF 2,200 - 2,600
Lot Size 0.5 - 1.2 Acres
Lease Term 20 Years
Escalations Varies
Stock Symbol YUM
Credit Rating
Moody's Ba2
Average Cap Rate Trend
Rates reflect year-over-year comparison
Recent Sales Comps
Brandywine, MD 4.50%
Versailles, MO 5.25%
Cave City, KY 5.80%