When most investors analyze net lease deals, they focus on the landlord’s perspective — cap rate, lease term, credit strength, and passive income. But few stop to ask:
What does the tenant care about?
In this special interview series, we spoke directly with multi-unit franchisees across QSR, automotive, and convenience sectors to uncover what really matters to operators when they sign long-term NNN leases. Their answers shed light on how savvy tenants evaluate real estate — and why understanding their motivations can help you become a smarter, more strategic investor.
1. “Rent Structure Can Make or Break a Store”
A 15-unit Checkers franchisee we interviewed emphasized that rent is not just a fixed cost — it’s a business risk. “If rent is too high out of the gate, we’re behind before we open. We walk away from deals where base rent exceeds 10% of projected gross sales,” he said.
Investor takeaway:
Franchisees are deeply aware of rent-to-sales ratios. If you’re investing in a property with aggressive rent escalations or inflated starting rents, future tenant retention may be at risk — especially if sales don’t keep pace.
2. “Visibility and Drive-Thru Access Matter More Than Demographics”
While investors often focus on income levels and household data, franchisees prioritize operational efficiency.
A regional Popeyes operator told us: “I’ll take a working-class trade area with 35,000 cars a day and a dedicated turn lane over an affluent zip code with poor visibility. If I can’t move cars through a drive-thru, I can’t generate sales.”
Investor takeaway:
Don’t rely solely on demographic reports. Consider site-level logistics like ingress/egress, traffic flow, parking count, and visibility — these are often deal-breakers for franchisees.
3. “We Want Flexibility — Especially on Assignments”
Most franchisees plan to grow, sell, or restructure at some point. An 8-store Dunkin’ operator said, “If a landlord restricts assignment rights or demands costly legal review every time we restructure our entity, it’s a red flag. We want partnership, not pain.”
Investor takeaway:
Lease terms that allow reasonable assignment and subletting without undue friction are not just tenant-friendly — they boost resale value. A flexible lease is more marketable to future buyers and avoids unnecessary tenant turnover.
4. “We Look at the Landlord Too”
Yes — franchisees are underwriting you.
A large Firestone operator with 20+ locations shared: “When we’re signing a 15-year lease, we want to know the landlord is fair, responsive, and understands the business. If we hear stories of nickel-and-diming or slow communication, we pass.”
Investor takeaway:
Reputation matters — even in passive ownership. Properties with institutional-quality lease structures, professional management, and clean documentation are more attractive to serious tenants.
5. “We’re Building a Business, Not Just Paying Rent”
At the core, every franchisee we interviewed emphasized that a lease is more than a real estate deal — it’s a business partnership.
They view long-term leases as a commitment to performance, brand reputation, and operational success.
Investor takeaway:
Properties that align with operator needs — smart rent, great access, clean lease language, and strategic locations — tend to attract longer-term, more stable tenants. And that’s exactly what drives value in the NNN market.
Final Thoughts: Know the Operator’s Playbook
Understanding how franchisees think isn’t just an exercise in empathy — it’s a strategic edge. Investors who recognize the metrics that matter to operators (rent ratios, site access, assignment terms) are better equipped to buy, negotiate, and manage assets that tenants want to stay in.
Because in the world of net lease real estate, the most profitable deals are built on alignment — not just yield.
Looking for franchisee-backed NNN deals with strong operator alignment?
We source and vet listings with sustainable rent, proven operators, and real site-level viability — so you can invest confidently.
Let’s put the next deal under contract.
FAQ
Q1: What’s the most important lease factor for franchisees when evaluating a NNN location?
A1: Rent structure is often the top concern. Franchisees focus on whether the base rent and escalation schedule align with their projected store revenue. If rent exceeds 8–10% of projected gross sales, many operators walk away — even in high-traffic or premium locations.
Q2: Why do franchisees care so much about site access and traffic flow?
A2: For QSR and service-based tenants, operational logistics like drive-thru efficiency, visibility, ingress/egress, and traffic counts directly impact sales. Even in areas with strong demographics, a poorly configured site can kill performance. Operators prioritize functionality over raw market stats.
Q3: How does lease flexibility impact a franchisee’s willingness to sign?
A3: Franchisees want the ability to assign or sublease the lease without unreasonable barriers, especially as they grow, restructure, or exit. Rigid assignment clauses or excessive legal burdens can turn tenants away — and make your asset less attractive to both tenants and future buyers.