• Ground Leases eliminate landlord responsibilities
  • Fast-casual restaurant (fastest growing segment of the restaurant industry)
  • Lease terms are generally 15 year NNN Ground Lease


  • Non-investment grade credit
  • Tough competition
  • Ground Leases don't allow for depreciation

Earnings Highlights

Q4 Earnings Summary
  • From Q4 2016 to Q4 2017 revenue increased 7.3%, comparable restaurant sales increased 0.9%, and net income increased $16 Million
  • From FY 2016 to FY 2017 revenue increased 14.7%, comparable restaurant sales increased 6.4%, and net income increased $22.9 Million.

Tenant Description

Chipotle is a restaurant committed to the idea that food served fast didn’t have to be a “fast-food” experience.” Chipotle serves a variety of Mexican dishes, such as burritos and taco assembled right in front of you.

Chipotle is a highly sought after brand. There is great demand for their freestanding stores as net lease investments. The properties are well located near major shopping centers, university and college campuses, and business centers. Chipotle typically features a 2,100 - 4,200 square foot building, and are usually situated on 0.43 - 1.55 acres of land. Chipotle net lease properties provide a long-term investment with no property management responsibilities. Generally the lease term is a 15-year NNN Ground Lease with four, five-year options with 7.5-12% increases every 5 years. Chipotle leases are corporately guaranteed. Chipotle's sales growth over the last decade is the highest across the "quick service/fast casual" segments. The chain is growing fast in part because of the rising popularity of Mexican food.

Chipotle uses high-quality raw ingredients, classic cooking methods, and distinctive interior design--features that are more frequently found in the world of fine dining, in their food served fast model. When Chipotle opened, there wasn't an industry category to describe what the company was doing. Some 20 years and more than 2,000 restaurants later, Chipotle competes in a category of dining now called "fast-casual," the fastest growing segment of the restaurant industry. Customers expect food quality that's more in line with full-service restaurants, coupled with the speed and convenience of fast food.

Chipotle tries to do a few things really well. The company elevates basic raw ingredients into food that's richer and more sophisticated through their recipes and cooking techniques. Similarly, Chipotle's restaurant design transforms simple materials in distinctive ways, giving their restaurants a style that's more architectural in nature and less dependent on standardized design elements. Chipotle's focus has always been on using higher-quality ingredients and cooking techniques to make great food accessible to all people at reasonable prices.

Chipotle is publicly traded on the New York Stock Exchange, CMG, with a market capitalization of $13.73 billion. Chipotle operates in the United States, United Kingdom, Canada, Germany, and France.

Average Cap Rate
12 mo avg with 10+ yr lease term
Average Property & Lease
Average Sale Price $1,884,700
NOI $91,408
$/Square Foot $550 - $950
Building SF 2,000 - 3,500
Lot Size 0.5 - 1.0 Acres
Lease Term 10 - 15 Year
Escalations 7.5 - 12% Every 5 Years
Stock Symbol CMG
Credit Rating
Moody's N/A
Average Cap Rate Trend
Rates reflect last 12 mos, short and long-term
Recent Sales Comps
Sidney, OH 5.50%
Port Richey, FL 5.24%
Phoenix, AZ 4.90%