If the Lake Forest IL store is only 20 years old that means it would have been developed
and opened during the "Convenience Strategy", a misguided effort to impress Wall Street
by building too many new stores in all the wrong places.
In the 1970s and 1980s McDonald's Corp. did an excellent job of negotiating the
purchase of new sites or obtaining long term leases. Leased sites always had the initial
20 years set in stone with decades of options after the first 20 years. If management
couldn't be sure there would be a McDonald's at that location in perpetuity there was
The idea that a store would be built with an opened ended rent number at the end of
20 years was extremely rare or unheard of.
But that changed during the Convenience Strategy - deals were rushed, inexperienced
real estate people were hired, and uniformed brokers became involved. Many deals
were, in a word, sloppy.
I don't know anymore about this store's lease than what's contained in this article but
McDonald's Operators should be wary of stores opened in the mid-1990s and should
become educated on the exact status of each store's real estate. And don't accept the
verbal representations of McDonald's corporate employees. They won't know a top
lease from a ground lease.
High rent pushes out Lake Forest McDonald's