Notes on retail development, site selection, and the markets we build in. Published Monday, Wednesday and Friday.
Hawaiian Bros committed 86 Southeast units across two franchise deals, but the company says more than half its restaurants are second-generation conversions, so the first owners this reaches hold existing restaurant boxes, not raw pads.
The 10-year rose 85 basis points last quarter and retail net lease asking cap rates rose nine, because the buyer still bidding is the cash buyer paying for long term and strong credit, so a pad built to sell should be built for that buyer.
Publix bought two Miami centers it anchors this fall and now owns 550 of its 1,432 store locations, so in Publix territory the pad's counterparty is more and more often the grocer itself — and that changes how a pad deal gets priced and how long it takes.
The 10-year moved about 90 basis points after June, the premium ground lease ask from that quarter now sits under it, and the first retrades in the reporting are in the Carolinas — a pad priced at a summer cap rate has not been repriced yet.
Quartz reported October 2 that Burger King expects about 200 company-operated restaurants to move to franchisees by year-end, and with The Boulder Group's Q2 report putting corporate QSR at 5.85 percent against franchisee QSR at 6.85 percent, the refranchising changes both who signs and what the dirt is worth at exit.
The drive-thru study published October 1 shows the industry's speed gain came at the pickup window, with voice AI in fewer than 2 percent of visits, and the prototypes answering the problem add lanes — which makes queue geometry, not building size, the thing that decides whether a pad works.
Two Publix-anchored centers reached the Southeast trade press this week — one 79 percent leased more than a year before it opens, one built in 1987 trading at about $114 a foot — and together they say the grocery anchor, not the pad listing, is the supply event.
Darden's September 24 report puts five of Yard House's 13 openings this year in converted Bahama Breeze boxes, and per Restaurant Dive's February report, thirteen of the fourteen conversion sites sit in Florida, Georgia, the Carolinas and Virginia.
Coresight's count went from a net 1,954 store closures through late August last year to a net 127 openings this year, and with completions at a record low the second-generation box is no longer a channel to plan around.
A summer opening count published this week puts Chick-fil-A first on raw units and near the bottom on rate, and the same week McDonald's told the market its next decade of capital goes into buildings it already occupies.
Brinker told investors it will ramp to 30 new Chili's a year, and the reported gap between 300 identified sites and eight in the pipeline is the part worth reading.
Construction input prices are rising more than five times faster than retail rents, and in a pad deal the land basis is the only line left that can absorb the difference.
A format announcement is pricing information: a brand that grows inside somebody else's building has told you what it can pay for dirt.
A chain-wide shutdown is a balance-sheet decision, not a market verdict, and the reporting on second-generation space says most of these sites should be priced as land.
The $325 million that went into Authentic Restaurant Brands this week is earmarked for home markets, and that language is showing up in every development announcement worth reading — the pad that gets built next is the one that completes a cluster somebody already runs.
Freddy's own disclosure numbers price what a brand gives up when it moves off the pad, and the growth landing in Georgia and the Carolinas this week is landing inline.
Four brands are discounting royalty, fees and equipment to get units opened, and two of those offers are priced by when the lease is signed and where the site sits.
7 Brew paid just under $2 million a site for leases it will not own, and the three-times spread inside one identical portfolio is the number worth reading.
Corporate QSR and franchisee QSR trade a full point apart, growth has moved to the franchisee side, and the land is the only line left that can absorb it.
Retail space is not what is short in 2026 — pads with drive-thru access are, and the restaurant closure wave will not fix that.