There is great demand for their free-standing Dairy Queen stores as net lease investments. Dairy Queen has locations in all major markets and are one of the most recognized QSR chains in the world. Dairy Queen typically features a 1,300 - 5,600 +/- SF building, and are usually situated on .3 - 1.5 acres of land. Dairy Queen net leases properties provide a long-term investment with no property management responsibilities. Generally the lease term is 15-20 years NNN with 4 five-year options with increases annually or 10% every 5 years. Dairy Queens are operated by franchisees as opposed to corporately owned. With Dairy Queen being one of the largest soft serve franchises in the world, their main competition includes: Baskin-Robbins, Ben & Jerry's, Braum's, Carvel, Culver's, Foster's Freeze, Good Times Burgers & Frozen Custard, McDonald's, Sonic Drive-In, Tastee Freez, and TCBY.
Pros:
- NNN lease eliminate Landlord responsibilities
- Locations in all major markets and one of the most recognized QSR chains in the world
- Lease terms generally are 15-20 years NNN
Cons
- Private Company/Non-investment grade
- QSR industry has seen volatility in performance and sales lately
- Many sites are franchisee locations, with operator strength varying significantly
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Jonathan Hipp
Jonathan Hipp began his career in real estate over 25 years ago. In his early years as a broker, he ventured into the net lease industry and quickly began leading the US net lease market, closing over $3 billion in transactions. In 2005, Jon founded Calkain Companies, a company focused solely on net lease investment services. As President and CEO, he has been instrumental in building the firm into one of the leading Net Lease real estate companies, transacting over $12 billion of net lease deal volume over the past 13 years. He has expanded Calkain’s services to include brokerage, advisory, asset management, capital markets, and industry research. He has become a well-known resource, panelist, and speaker at various Net Lease and Industry conferences and is a regular contributor to GlobeSt.com on real estate trends. In June 2015, Jon’s passion for the real estate business was again recognized as he was nominated for the Top Real Estate Player in the DC area by SmartCEO magazine.
