Sonic steps up expansion via property conversions

Miami /
Jan.January 02, 2016 02:00 PM

Sonic Corp. has increased its conversion of commercial properties at high-traffic locations in Florida and other states to drive-in outlets for the quick-service restaurant chain.

The Oklahoma City-based company has converted banks as well as former quick-service and casual-dining locations to Sonic locations, Andrew “Drew” Ritger Jr., Sonic’s senior vice president of development, told Nation’s Restaurant News.

“As we expand, we found there was an opportunity to repurpose other restaurant locations,” Ritger said. “Many times, they are on great real estate, but they had run into some conditions like the operator of the other concept got into some financial trouble, or the license term or contract had ended and weren’t renewed.”

Sonic introduced its conversion format about two years in Childress, Texas. “What we normally do is take the shell of the building, and then we convert it to our kitchen layout,” Ritger told Nation’s Restaurant News. “Our kitchen designs can be put into just about every concept. Occasionally we have extra space for employee lockers or meeting rooms.”

Compared to constructing Sonic locations from the ground up, conversions usually have “lower investment cost and a faster construction cycle,” Ritger said.

Conversions can unfold up to 120 days faster than a typical Sonic location’s six-to-eight-month development schedule, and the cost savings are as much as 40 percent, he said.

Sonic’s conversions have been especially effective in expensive real estate markets of California and the Northeast.

Other markets where Sonic has repurposed locations include Alabama, Connecticut, Florida and Rhode Island. “It depends on what the opportunity is and if the franchisee believes it’s good real estate and a good business opportunity,” Ritger told Nation’s Restaurant News.

The largest restaurant in Sonic’s system is now in Cheektowaga, New York, a suburb of Buffalo, which recently opened in a converted Perkins Restaurant & Bakery location. The restaurant spans 5,000 square feet and seats about 80 people. Ritger said business there been robust since the November 5 opening.

Sonic has converted former Burger King and Wendy’s restaurants in California, former Wendy’s and Perkins Restaurant & Bakery locations in New York, bank buildings in  New York and New Jersey, a former Kentucky Fried Chicken restaurant in Cleveland and a former Wendy’s location in South Carolina.

Ritger told Nation’s Restaurant News that “most of the [conversion] locations already have the right conditional-use and drive-thru permits. These are things that save the franchisee time and money.”

Sonic had 3,526 drive-ins in 45 states as of August 31. [Nation’s Restaurant News] — Mike Seemuth


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