Are Standalone Drive-thru Properties still a good investment in the US?
I am contemplating investing in the US commercial real estate(standalone properties with drive-thrus particularly) and calling out to all investment gurus to help answer a few questions:

1. Do you think the standalone drive-thru concept will exist/be in demand in 20 years?
2. What franchise brands for tenants are preferable? See a lot of Burger Kings &amp; starbucks listed for sale - anyone have any idea why that is?
2. What rate of value appreciation do you see in next 10 years for a property that yields 5% cap rate
3. What's a good cap rate in the current market environment?
4. What US states are good for such investments. I am Canadian so I would prefer in the North East but open to other areas for right opportunity.

Looking forward to some valuable input, and thanks in advance!
[{"id": "hvuiukf", "text": "Yes, with building costs as high as they are I\u2019m seeing more and more QSR and Fast Food users retrofitting existing space rather than building ground up. Certain users will just always build because they can and have an aesthetic they stick too, but there\u2019s no shortage of quality users and franchisees that would rather save money and retrofit.\n\n1. Yes, this is anecdotal, but several of my clients have mentioned that they learned during COVID that operating the facility without the dining room they ended up making about as much or more than pre pandemic. I believe this is attributed to a) reduced costs from not having to operate a dining area (cleaning, extra employees, etc.) and b) sales being minimally impacted. I believe most people that would have dined in, just opted to go through drive thru and eat at home. A minor inconvenience, but not a complete deterrent imo.\n\n2. As for preference, I\u2019m just looking at credit and financials. I don\u2019t care if it\u2019s a Burger King or a Fogo De Chao, if the financials and concept are good and proven, I\u2019m happy. As for why a lot of Burger King and Starbucks, I think it\u2019s two fold. Burger King started heavily into franchise and Starbucks are almost exclusively built by preferred developers and owner developers so they\u2019re also pretty easy to flip for a profit in either case.\n\n3. Hard to answer, I personally don\u2019t foresee any real estate collapse or anything crazy. I think we\u2019ll slightly outpace inflation.\n\n4. Good is subjective. If you have tons of cash and don\u2019t want to do any work, 5% may be just fine. Most of my clients want a minimum of 8% if they have any sort of managerial expense or expected capital outlay. If you asked me, I\u2019m not looking at anything with less than a 10% cap, but I\u2019m also a small fish and pretty risk averse.\n\n5. Once again subjective. There are fantastic markets, that are too expensive and there are small towns that are an absolute gold mine. The location principle always applies, but this will depend on your risk tolerance, access to capital, amount of capital, knowledge of market, etc.\n\nHope this is helpful!", "replies": [{"id": "hvys2fw", "text": "Appreciate the input u/anacott27. Agree with everything you said and from your responses it seems you are a real estate agent. I could definitely use some help in narrowing down areas of interest and target property portfolios. Pls dm if possible.\n\nJust a little bit more about myself for anyone else who wishes to reach out, or perhaps in the same boat as I am and looking to invest in US Commercial, I plan to retire after selling my house in Canada and moving into a condo(that we own) with my wife. I intend to use the proceeds towards investing in commercial real estate(preferably in the US) to generate passive income. The amount is not huge, I can probably  afford up to 1.7 million USD and need to make around 11k per month(which equates to around 8% cap rate per month). Property should be hassle free with minimal overheads, if any. Because this is my life savings, I am extremely risk averse. Obvious important fundamentals should exist such as a strong tenant and a long term lease in place.", "replies": [], "depth": 2}], "depth": 1}, {"id": "hvuq7sn", "text": "&gt;1. Do you think the standalone drive-thru concept will exist/be in demand in 20 years?\n\nYes. Mobility changes would be in combustion.\n\n&gt;2. What franchise brands for tenants are preferable? See a lot of Burger Kings &amp; starbucks listed for sale - anyone have any idea why that is?\n\nIt depends. BK, Starbucks and Mc D's are common. I think the best are those which are recession proof.\n\n&gt;3. What rate of value appreciation do you see in next 10 years for a property that yields 5% cap rate\n\nMy guess is as good as yours. I doubt rates will drop lower than now.\n\n&gt;4. What's a good cap rate in the current market environment?\n\nIt depends on the tenant, the market and the length of the contract\n\n&gt;5. What US states are good for such investments. I am Canadian so I would prefer in the North East but open to other areas for right opportunity\n\nFree tax states like Florida, Texas, Nevada.", "replies": [{"id": "hvysn20", "text": "Thanks u/mundotaku! Which businesses/brands do you think are recession proof?", "replies": [{"id": "hvz2uvr", "text": "Think of services which can't be replaced by computers or technology and people would use even if they are tight. For example, a barber, medical (even when their caps can be high), tires.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hvuyxoz", "text": "Definitely will continue to exist. \n\nEverything else you asked is pretty subjective and once you identify your macro thesis, it\u2019s just deal specific after that. \n\nI look at a lot of NNN leases and you gotta understand the obligations vs payments etc. those big tenants are sharp and will screw you.", "replies": [{"id": "hvytm5z", "text": "Totally agree u/rohde88, I have been a commercial tenant in past and getting caught on the wrong side of a clause could have dire consequences. What I have seen is that typically franchisee negotiated leases are much favorable for Landlords compared to corporate involved leases(or head leases). Any tips on which tenant brands are easier to deal with or generally amenable to more favorable landlord conditions?", "replies": [], "depth": 2}], "depth": 1}, {"id": "hvvagm7", "text": "Yes there will still be demand in 20 years for this product (more tenants want drive-thru now than 10 years ago), but the cap rate is highly dependent on the market, the term left on the lease, tenant sales (if known), and the credit of the tenant.   The value in these deals is more in the  development/leasing than in the owning/operation.", "replies": [], "depth": 1}]