Franchise Real Estate Support: Why It Matters

For many aspiring franchise owners, the journey often begins with an exciting vision of their future business. However, as the process unfolds, one crucial element consistently takes center stage in our conversations: franchise real estate support.

Whether you're aware of it or not, real estate support plays a significant role in the timeline of launching your franchise, from scouting the perfect location to the actual construction. After all, when you spot a recognizable brand like Jack in the Box, what you're truly seeing and interacting with is the real estate—the physical building and its location.

In this article and podcast, we'll dive into the often-underestimated impact of real estate support on your franchising journey, offering key insights for franchise candidates.

Meet Nicole Curtis: franchise real estate expert

In this episode, we sat down with Nicole Curtis, Real Estate Development Manager at Jack in the Box, who boasts an impressive 25 years in the real estate industry. Nicole's extensive experience includes new store development and working with franchisees across the United States.

Nicole's journey into real estate began serendipitously when she "blindly" applied for a retail real estate position after selling commercial real estate. The rest, as they say, is history. She quickly discovered a passion for the field, especially working with franchisees. "I love what I do. I love real estate. I love working with franchisees, and it's a great blend, making it a super, super rewarding and fun job," she shares.

In her role, Nicole supports franchisees for Jack in the Box with their real estate needs, bringing a wealth of knowledge from her prior experience as a real estate development manager for Qdoba.

The Franchisee Support Process: From Development Agreement to Site Selection

So, what does the real estate support process look like for a new franchisee? Nicole walks us through the steps once a development agreement is signed and the new franchise group is introduced to her team.

Identifying Strong Trade Areas

"First, I partner with the development team and sometimes the franchisee to identify strong trade areas within a market," Nicole explains. This identification is based on several crucial factors:

• Regionality

• Retail traffic generators (e.g., Walmart, Target, Costco, major grocery stores)

• Demographics

• Traffic counts

• Competitor sales of other brands

Once these trade areas are identified, Nicole introduces the franchisee to a tenant representative (tenant rep) broker in that market. These brokers are carefully selected for their understanding of the brand's criteria and their close working relationship with the Jack in the Box team and the franchisees.

Conducting Site Tours and Evaluations

After trade areas are pinpointed, the next step involves site tours of potential real estate opportunities. Nicole and her team assist franchisees in identifying and selecting viable sites with characteristics that align with Jack in the Box's criteria for successful sales.

Following a potential site's identification, a thorough site review and evaluation take place. This assesses alignment with brand requirements, including crucial elements like:

• Ingress and egress (access points)

• Visibility

• Parking

As Nicole emphasizes, "Even if a site is super visible, but you can't get to the site or access is poor, then that's a challenge." This meticulous review ensures all parties are aligned on the site's characteristics.

Real Estate Committee Review Process

The final hurdle before a site is approved is the real estate committee review. Nicole compiles all the information, including the franchisee's proposed site plan, and presents it for corporate approval.

Once approved, the franchisee can move forward with the lease or purchase process and begin the construction phase.

Demystifying Tenant Broker Networks

A common question from prospective franchisees is about tenant broker networks and potential fees. Nicole clarifies that these networks are a significant benefit included within the franchise support.

"Typically, in most markets, especially new markets we go into, real estate development managers have strong relationships with the brokerage community, developers, and owners," Nicole explains. "We've partnered with a real estate broker that represents our brand. They're not representing the landlord; they represent our brand and work closely with us, understanding our criteria."

Crucially, franchisees do not pay an additional fee for this service. The commission for the tenant rep broker is paid by the landlord or property owner when a deal is identified and executed. "It's actually another level of a free service for the franchisee," she notes. These brokers often have access to "off-market" opportunities that aren't publicly advertised, providing an invaluable advantage.

Understanding "Market Points" and Trade Area Definition

When it comes to defining optimal locations, Jack in the Box utilizes a sophisticated approach involving "market points" and advanced mapping software like SiteWise.

"A market point is simply a pin that is dropped at a key intersection within a one-mile trade area," Nicole defines. "It's a point that identifies that one-mile trade area where we and the franchisee can look for a site."

SiteWise, an analytics program, uses algorithms and various data points—from traffic and competitor sales to the presence of large retail traffic generators—to identify potentially strong trade areas.

Real estate development managers then review and often refine these suggested market points based on their extensive market knowledge and "boots on the ground" experience, collaborating with brokers to ensure the most strategic locations are targeted.

Key Pointers for Aspiring Franchisees on Site Selection

For those just beginning their real estate search, Nicole offers some vital advice:

• Prioritize quality over cost: "Don't necessarily just go for the least expensive real estate, but go for the best real estate," she advises. Focus on strong characteristics like access, visibility, and traffic patterns. Signalized hard corners are often ideal.

• Keep an open mind: While owning real estate is often preferred, consider all options, including ground leases, building leases, or conversion opportunities of closed locations. Purchase opportunities can be scarcer and more competitive, and sometimes a leased signalized hard corner might be a better piece of real estate than a mid-block purchase.

• Leverage franchise support: "Really take advantage of what Jack in the Box provides to them. Try to align and work closely with the real estate development manager and also the broker to vet these sites and to find sites," Nicole urges. This collaborative team approach maximizes success.

Now, let's take a look at how long it typically takes to find and build your franchise locations.

Demystifying the Development Timeline: Why 18-24 Months?

The 18-to-24-month timeline for opening a first franchise location can seem daunting to newcomers. Nicole explains that construction is only a fraction of this period.

"When you first identify a site, you've got to negotiate that site, whether it's a purchase or a ground lease or a building lease," she explains. The speed of these negotiations can vary depending on the other party.

Once the site is approved and the agreement executed, the next significant phase is getting drawings done and securing permits. "This is one of the longest steps that we typically see," Nicole notes, "and that a franchisee typically sees in the development process that can slow the building process down and delay them getting started in building."

While some municipalities are efficient, permitting can take 180 days (six months) on average, with potential for 30-day extensions. In more challenging municipalities, this process could stretch to a year or even longer. Once permits are in hand, construction moves much faster, typically around 150 days.

Nicole's Top Takeaway for New Franchisees

When asked for one crucial piece of advice for franchisees entering the real estate process, Nicole emphasizes understanding and staying ahead of the development agreement timeline.

"One thing that is easy to get caught up in is getting that first site approved, but then knowing that you need to immediately go on and start looking for that second site of your development agreement commitment," she advises. Time flies, and proactive site identification for subsequent locations is key to staying on track with development goals.

The real estate journey in franchising is complex, but with dedicated support and expert guidance from professionals, franchisees are well-equipped to navigate the process successfully.

Check Out These Additional Resources

We hope this article and podcast gave you a deeper understanding of the importance of real estate support when it comes to achieving your franchising goals.

At Jack in the Box, we’re looking for multi-unit franchisees who are excited to bring our craveable 24/7 menu to new markets across the country.

Here are some additional online resources you may like to check out:

• Jack in the Box vs McDonalds: Which Franchise is Best?
• 5 Reasons to Purchase a Jack in the Box Franchise
• What Are the Jack in the Box Franchise Requirements?

 If you have any questions, please contact our franchise sales and support team.