IHOP Franchises

IHOP

The offering circular describes four different franchise programs for full service restaurants which feature "IHOP pancakes as well as a diverse menu of other breakfast, lunch and dinner items. According to the offering circular, the Initial Franchise Fee is $50,000 for the Single Store Development Program; between $0 to $600,000 for the Purchase Program; $80,000 to $2,000,000 for the Multi-Store Development Program; and none for the Novation Program. Additionally, the offering circular states that if the franchisee acquires real estate from an IHOP Affiliate in connection with the Single Store Development Program or the Multi-Store Development Program, the franchisee will pay the Affiliate for the real estate, typically in the amount of $300,000 to $1,000,000 plus reimbursement of the Affiliate's costs and expenses. If the franchisee takes an assignment from an Affiliate of a real estate purchase agreement before the closing, the franchisee must reimburse the Affiliate for some or all of its costs and expenses as negotiated (typically in the amount of $0 to $175,000).

The franchisor estimates that the initial investments in each of the programs, including the Initial Franchise Fee, will fall within the following ranges:

Program Low High
Single Store Development Program
$836,000    $4,236,750
Purchase Program
$91,550    $3,845,250
Multi-store Development Program
First Restaurant $971,000   $6,436,750
Each additional Restaurant
$891,000     $4,426,750
Novation Program
$0    $0

The franchisor states that it provides financing arrangements for the Initial Franchise Fee, but for other items, financing arrangements are made, if at all, by the franchisee and is not normally assisted with respect to those arrangements.

IHOP's Franchise Resources

UFOC 5-9 11-12 17-19

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