Taco Bell NNN
lease analysis.
Taco Bell is the largest U.S.-based QSR brand by unit count among Yum! Brands' portfolio. Like McDonald's, the critical distinction is corporate-signed vs. franchisee-signed leases. Yum! Brands has been actively refranchising locations, which means a substantial percentage of Taco Bell NNN available for sale is franchisee-signed rather than corporate-signed.
Quick reference · Taco Bell
- Legal entity
- Taco Bell Corp. (corporate) or franchisee entity
- Parent
- Yum! Brands, Inc. (YUM)
- Credit profile
- Yum! Brands is investment-grade (BB+/BBB-). Most Taco Bell locations are franchisee-operated.
- Typical lease
- NNN or ground lease; corporate vs. franchisee-signed varies significantly.
- Typical term
- 15–20 years initial with options.
- Rent bumps
- 10% every 5 years typical.
- Prototype size
- ~2,600–3,200 SF on a 0.75–1.25 acre site.
- Cap rate band
- 5.75–7.00% (2026, depending on corporate vs. franchisee)
About Taco Bell as a NNN tenant
Taco Bell is the largest U.S.-based QSR brand by unit count among Yum! Brands' portfolio. Like McDonald's, the critical distinction is corporate-signed vs. franchisee-signed leases. Yum! Brands has been actively refranchising locations, which means a substantial percentage of Taco Bell NNN available for sale is franchisee-signed rather than corporate-signed.
How Taco Bell structures its NNN leases
Taco Bell NNN leases vary between corporate-signed (Taco Bell Corp. or a Yum! subsidiary) and franchisee-signed. Franchisee leases may or may not carry Yum! Brands parent guarantee — verify specifically.
Store specs and site profile
Prototype Taco Bell is 2,600–3,200 SF with drive-through configuration on a 0.75–1.25 acre site. Newer prototypes emphasize dual drive-through and mobile-order pickup.
Red flags on a Taco Bell NNN deal
- Franchisee-signed lease without Yum! Brands parent guarantee
- Short remaining primary term
- Weak trade-area QSR demographics
- Basis materially above replacement cost
What to underwrite before buying a Taco Bell property
- Corporate vs. franchisee lease
- If franchisee: guarantor entity, franchisee credit, Yum! parent guarantee language
- Remaining primary term and options
- Trade-area QSR competition and daypart demographics
Frequently asked questions
Are most Taco Bell NNN properties franchisee-signed?
Yes. Yum! Brands has refranchised the majority of Taco Bell locations. Most Taco Bell NNN for sale is signed by franchisees operating under the Taco Bell brand. Corporate-signed Taco Bell is less common and trades at tighter cap rates accordingly.
What cap rate is typical for Taco Bell NNN?
In 2026, corporate-signed Taco Bell ground leases in primary markets trade at 5.50–6.25% cap rates. Franchisee-signed Taco Bell typically trades at 6.25–7.25%.
Using Taco Bell in a 1031 exchange
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