Q2 2026 Net Lease Cap Rate Report
B+E’s Q2 2026 Net Lease Cap Rate Report shows net lease cap rates held largely steady through the second quarter, with sector averages moving
Read More » The quick service restaurant sector remains one of the most closely watched segments in net lease real estate.
At year-end 2025, inventory, cap rates, and lease duration trends are sending clear signals to investors heading into 2026.
According to B+E’s proprietary 1031 Trade Database there are currently 1,041 QSR properties on the market, with an average cap rate of 5.68% and an average remaining lease term of 13.4 years.
The story is not volatility but stability—with selective compression in premium brands.
Inventory Growth with Stable Cap Rates
Since June 2025, total QSR inventory has increased approximately 5%, rising from 989 to 1,041 listings.
Over the same period, average cap rates declined just 2 basis points to 5.68%.
For investors, this signals:
- Healthy transaction flow
- Stable yield environment
- No broad-based repricing pressure
Year-over-year, inventory declined from 1,117 to 1,041 properties, while cap rates remained unchanged at 5.68%.
In a higher-rate macro environment, flat cap rates in the QSR segment reflect continued investor demand for essential retail and recognizable brands.
Compression in Premium QSR Tenants
While overall averages remain stable, individual tenant performance tells a more nuanced story.
Sub-5% Cap Rate Expansion
In June 2025, only 10 QSR tenants averaged cap rates below 5.00%. That number has now increased to 14.
This reflects continued capital migration toward:
- Strong national brands
- Long lease duration
- Corporate-backed operators
- Ground lease structures
McDonald’s and In-N-Out Lead Compression
- McDonald’s: 3.92% average cap rate
- In-N-Out Burger: 3.25% average cap rate.
In-N-Out now holds the lowest average cap rate in the sector, driven by ground lease structure and California market strength.
Premium pricing is not broad-based. It is concentrated in tenants with strong credit profiles and durable brand demand.
Long-Term Lease Duration Is Commanding Attention
Lease term remains one of the strongest drivers of pricing in QSR net lease investment.
Chipotle Mexican Grill leads the market in properties with 10+ years remaining, with 59 listings averaging a 4.81% cap rate and 14.4 years of lease term.
Other notable long-term lease performers:
- Wendy’s: 17.0-year average term (10+ cohort)
- Chick-fil-A: 14.4-year average term (10+ cohort)
- Taco Bell: 16.0‑year average term (10+ cohort)
For 1031 buyers, long-duration income remains a primary allocation priority.
Geographic Concentration Remains Strong in the Sun Belt
Texas leads the nation with 154 QSR properties on the market.
Florida follows with 121 properties, while California ranks third with 65 listings.
States with strong population growth and consumer spending continue to dominate QSR inventory levels.
For investors, geographic exposure remains a strategic lever — not just tenant selection.
What This Means for QSR Net Lease Investors in 2026
The year-end data suggests three clear themes heading into 2026:
1. Stability Over Volatility
Average cap rates have remained steady at 5.68%, even as inventory fluctuated modestly.
2. Flight to Duration
Properties with 10+ years remaining continue to attract premium pricing.
3. Selective Compression
Institutional and ground-lease-backed brands are commanding sub-4% cap rates.
For 1031 exchange buyers, this environment rewards disciplined underwriting. The spread between premium and secondary tenants has widened.
Understanding that spread is critical to capital deployment decisions.
QSR Industry Fundamentals Support Net Lease Demand
Beyond real estate metrics, the QSR sector’s underlying industry growth remains strong.
According to Fortune Business Insights, the global QSR industry is valued at approximately $1.1 trillion and is projected to reach $1.9 trillion by 2032.
North America accounts for more than 37% of global market share.
Investor appetite for long-term leased QSR real estate reflects confidence in:
- Consumer resilience
- Brand expansion plans
- Operational scale
- Franchise-backed growth
Download the Full QSR Listed Inventory Report
The QSR net lease market is not uniform. Cap rates, lease structures, and tenant strength vary significantly by brand and geography.
For a complete breakdown of:
- Tenant-level cap rates
- 10+ year lease performance
- State-by-state averages
- Inventory shifts by brand
Want a custom net lease segment report?
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