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Hornius Emeritus

A farewell to Dairy Queens

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1 minute ago, Felix said:

You probably ran into my Dad and his hoodlum Travis Heights friends.  I've heard more Pig Stand stories over the years than I could possibly remember.

I was a ST. Edward’s HS punk. A couple of classmates were Travis Heights friends, so no conflicts there except when we stole their Travis HS chicks. I lived on Elmhurst Drive, just east across I-35 between Woodland and Riverside.

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1 minute ago, Armybrat said:

I was a ST. Edward’s HS punk. A couple of classmates were Travis Heights friends, so no conflicts there except when we stole their Travis HS chicks. I lived on Elmhurst Drive, just east across I-35 between Woodland and Riverside.

I have no doubt y'all crossed paths.  Dad graduated from Travis in '62 and his brother in '64.  They lived on Harwood Place just off Travis Heights.  My Grandfather was APD so they couldn't get too out of control but they got into plenty of mischief.

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I swung through the drive-thru of DQ in Hamilton in 1989.  After placing my order, they instructed me to pull around front to wait for the order.  Once the order was ready, they waived me into the store to get it.  WTF?  I've been boycotting DQ in Hamilton ever since.  Fool me once, shame on me.  Fool me twice - won't get fooled again.

Otherwise, I enjoy stopping in DQs in small towns across Texas.

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I graduated St Eds HS in 1962. Maybe your grandpa was the officer who stopped a carload of us after leaving the Pig Stand. (I was driving). 
seems that a couple of my buddies in the  back lifted their root beer mugs.

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11 hours ago, hornhorn said:

 

But those bad loans are collateralized with real estate. 

Subways are much smaller however and most times do not include real estate, if your bank is allowing <$30K downpayment for a million dollar loan, sign me up.

Also Subways go on how much they do per week in revenue. Average unit volume for a Subway is $250,000/year which is $5,000/week and they range around 30 to 40 multiple for that. As in a $5000/week revenue Subway with a decent lease will cost around $200,000 all in. So if you're getting paperwork for million dollars, those Subways are extremely high revenue Subways and are making a lot of money on their own. I'm thinking typically around $30,000/week or more which indicates that there are problems with the operators and not stores.

And finally, its been a while for me but since you mentioned SBA loans, PE firms won't qualify for those as the maximum borrower net worth for SBA loans is $5,000,000. And asset net worth of $15,000,000. 

Sorry, I was unclear. The collateral on these SBA loans may look decent at the time of funding, but by the time I'm calling a default, it ain't worth shit. Every restaurant I've collected against was a rental property so no real estate. The only security is the equipment and personal guaranties. By way of example, one I'm working on right now (not a Subway) has an outstanding balance of ~$395K. I seized all their equipment/inventory/etc and had it appraised. $3-6K based on how I go about selling it, minus expenses. For reasons that I won't get into, those personal guarantees generally aren't worth the trouble (at least in the context of SBA loans since they're 75% guaranteed by the gubmint). I think that may be the worst LTV I've ever had, but I'd actually consider this a good one overall, since this particular bank won't actually lose any money. It's been on the books for several years so they'll still come out a bit ahead. And the restaurant owners are still doing just fine as well. 

Edit to add: I'm only on the backend of these SBA loans so I wasn't aware of the limits you mentioned. That makes sense.

Edited by SquishMitten

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18 hours ago, miguelito said:

When I was a kid, we used to take our dogs to the park.  After that, we'd go through the DQ drive-thru and get dip cones for us kids, and a cup of soft serve for the dogs.  They loved that stuff.

My dog loved Butterfinger Blizzards.

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36 minutes ago, Armybrat said:

I was a ST. Edward’s HS punk. A couple of classmates were Travis Heights friends, so no conflicts there except when we stole their Travis HS chicks dames. I lived on Elmhurst Drive, just east across I-35 between Woodland and Riverside.

No way you called them chicks.

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12 minutes ago, Fudge Nuggets said:

My dog loved Butterfinger Blizzards.

I have two M&M Blizzards in my freezer right now.

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3 hours ago, Armybrat said:

Live Oak & South Congress. (East side of the intersection next to the little triangular park)

It is now a Salad & wine bar called Viniagrette. Even the old covered drive-in parking cover is still there (the long “wavy” roof next to Post Road). Used to order burgers & shakes on the intercom, and the bumper jumpers (Travis High School chicks) would bring the food out and hook the trays on the drivers side window.

it was a good place to pick up South Austin’s grandma.

 

Any chance that was an Italian restaurant back in the 80s?  I may be thinking of another place just east of Congress in that vicinity.

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Yes, it was a different Italian restaurant. In fact we had dinner there in the late 1990s before it turned into the present wine bar.

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1 hour ago, Jerry Callo said:

Doomsday prepper?

Need to get some more. Have a coupon, buy three 16 oz. Blizzards at $1.99 each - through November. They “let” youuse the same coupon over & over.

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About 8 years ago our Little League district (Hill Country) held a district only All Star season for Machine Pitch players since Little League International didn't host tournaments for that age level. We played all over the hill country that summer and my son wanted to try and eat at every Dairy Queen in the Hill Country as some kind of bucket list for 8 year olds.

There were major differences in quality between the various Dairy Queens we visited. Boerne, Blanco and Kerrville were the cleanest and had the best quality of food. The Dairy Queen in Burnet was clean but I am pretty sure the two burned out women working there were meth head who overcooked everything. The Dairy Queen in Mason, TX almost made me give up on the Dairy Queen challenge. You could barely see inside the store through the dirty windows. I tried to talk my son out of that visit but he insisted, big mistake. We still talk about how awful that experience was.

 

 

 

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8 hours ago, Bevo said:

Who is the Wendy's guy? I had a cousin in Columbus who just passed who at one time owned about 100 Wendy's in Texas. His business partner who ran day to day operations is still working, though.

James Bodenstedt, a franchisee from San Antonio bought all the DFW stores.

This occurred in 2014, source: https://www.dallasnews.com/business/2014/02/25/wendys-sells-its-company-owned-d-fw-stores-to-san-antonio-franchisee/

Edited by hornhorn

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Damn, all this death to small down and Dairy Queen talk has me hankering to watch Texasville again. Where can I find it to watch it?

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We stopped at one oh maybe three years back in Quanah or Childress or one of those places. Pretty damned filthy. I remember thinking at the time "how can this place make it?" I assumed because it was the only show in town, but I guess even that can't keep em afloat.

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12 hours ago, Bevo said:

I don't remember who made the Pizza downstairs, but it didn't really matter after the buzz.

The Red Tomato.

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15 hours ago, Thujone said:

We stopped at one oh maybe three years back in Quanah or Childress or one of those places. Pretty damned filthy. I remember thinking at the time "how can this place make it?" I assumed because it was the only show in town, but I guess even that can't keep em afloat.

"Quanah, Texas.  Home of Kellie Kyle."  

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I ate at a Dairy Queen in Dumas, TX a few years ago driving back from Colorado ski trip. That's the only time in the last 20 years I've eaten at one. 

Also, jealous of having lunch with Henry Kravis. KKR is one of the premiere PE firms so of course it went well. I do a lot of work with PE firms and have seen firsthand how easy it is to pull together some money and call yourself a PE-- tons of crappy PE firms who are one hit wonders or shady or are a deal away from shuttering once you get out of the tier 1 and tier 2.

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I remember certain DQs would have additional menu items depending on location.  Like the owner would just add an enchilada plate or chopped beef sandwiches.  Or various other non-standard DQ items.  Anyone else remember that?

There is one in Dilley near our family's place (right off 117 and I-35 in front of the little airport).  Have not eaten there in years.  It was shockingly slow.  Like 3 times slower than any fast food restaurant I have ever been to.  It is faster to drive the extra 30 miles roundtrip to the sonic in Pearsall than to deal with the Dilley DQ.

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I remember certain DQs would have additional menu items depending on location.  Like the owner would just add an enchilada plate or chopped beef sandwiches.  Or various other non-standard DQ items.  Anyone else remember that?
There is one in Dilley near our family's place (right off 117 and I-35 in front of the little airport).  Have not eaten there in years.  It was shockingly slow.  Like 3 times slower than any fast food restaurant I have ever been to.  It is faster to drive the extra 30 miles roundtrip to the sonic in Pearsall than to deal with the Dilley DQ.

Yep. I mentioned before on here, the one in Crane had the best biscuits and gravy ever - they served west Texas breakfast.

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Nothing like working at a small-ish financial service company that gets sold off to PE and run into the ground as they have zero industry experience, only for them to realize they are over leveraged by 40% and don’t even have assets to liquidate. Rats fleeing a sinking ship.

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1 hour ago, El Diablo said:

How much would it cost to buy a DQ right about now? I mean the restaurant, not a Belt Buster.

It typically will go off of EBITDA multiple, the higher the EBITDA the higher the multiple. Most DQs are struggling I presume that have revenues under $750K. They are all losing money, a lot of money.

Having said that, I wouldn't buy one even if someone handed the keys to me. 

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19 minutes ago, hornhorn said:

It typically will go off of EBITDA multiple, the higher the EBITDA the higher the multiple. Most DQs are struggling I presume that have revenues under $750K. They are all losing money, a lot of money.

Having said that, I wouldn't buy one even if someone handed the keys to me. 

You know, a lot of these small town DQ's have been occupying the same real estate for decades. Seems like the locations would have some value even if the brand were suffering.

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Just now, El Diablo said:

You know, a lot of these small town DQ's have been occupying the same real estate for decades. Seems like the locations would have some value even if the brand were suffering.

Real estate will have some value but usually that is never considered in the EBITDA multiple when buying and selling restaurants. That's because retail real estate isn't priced per sqft but priced how much rent one is willing to pay and what sort of a return a said investor(typically a REIT) is willing to accept since those properties are rarely owned by operators/owners of those restaurants. 

So to answer your question there is some value in the retail real estate but in a small town unless you can replace a DQ with another concept that is going to do equal or better in revenue and indirectly generate equal or better rent via occupancy cost, those locations are may or may not be valuable. 

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I'm thinking a place that sells frozen wine cooler slushies. "Alaskan Abode".

Or a strip joint selling dip cones.

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2 hours ago, Johnny Sack said:

I remember certain DQs would have additional menu items depending on location.  Like the owner would just add an enchilada plate or chopped beef sandwiches.  Or various other non-standard DQ items.  Anyone else remember that?

There is one in Dilley near our family's place (right off 117 and I-35 in front of the little airport).  Have not eaten there in years.  It was shockingly slow.  Like 3 times slower than any fast food restaurant I have ever been to.  It is faster to drive the extra 30 miles roundtrip to the sonic in Pearsall than to deal with the Dilley DQ.

They opened one in Frisco a few years back.  I was so excited.  Grew eating at most every location west of I35.  Good gravy they are a beating.  The wait.....it's too painful to go back to.  The one and only Yelp review I ever left was for them as i was told to "pull forward.....it'll be right out" and waited for what seemed like an eternity. 

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16 minutes ago, El Diablo said:

I'm thinking a place that sells frozen wine cooler slushies. "Alaskan Abode".

Or a strip joint selling dip cones.

girl why dont we have both GIF

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The DQ in my small town is one of four places to eat. It's not terrible but we don't have much. 

Close to home, my first 401k job was a Braum's (yeah it's Oklahoma HQed yada).

I had to get my parents to sign off as I was under 16, got a hardship to ride my motorcycle to work. My father took all my money to pay for said motorcycle, but damn I was a cool ass 15 y/o. (At least in my own 15 y/o mind) 

I recently visited the Braum's in Plano. Then and now it seemed a step up from DQ with a small milk and eggs section, very clean and the burger patties seem a higher quality of frozen meat.

I may or may not have had my first drug abuse saving up "empty" whip cream cans for "consumption" in the walk in freezer. 

Edited by BurntEyes

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35 minutes ago, El Diablo said:

I'm thinking a place that sells frozen wine cooler slushies. "Alaskan Abode".

Or a strip joint selling dip cones.

The wine cooler item will never take off in small town TN.

But I am 💯 on the strip club with dip cones.

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They opened one in Frisco a few years back.  I was so excited.  Grew eating at most every location west of I35.  Good gravy they are a beating.  The wait.....it's too painful to go back to.  The one and only Yelp review I ever left was for them as i was told to "pull forward.....it'll be right out" and waited for what seemed like an eternity. 

The one between Addison and Richardson seems clean but we’ve only stopped for Blizzards.

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1 hour ago, BurntEyes said:

The wine cooler item will never take off in small town TN.

But I am 💯 on the strip club with dip cones.

The post below yours inspired me - "Blizzards" could be the name of the titter. Waitress chicks in little fur bikinis and ear muffs. Keep the joint at about 45 deg F.

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25 minutes ago, El Diablo said:

The post below yours inspired me - "Blizzards" could be the name of the titter. Waitress chicks in little fur bikinis and ear muffs. Keep the joint at about 45 deg F.

The chair dance rub and tug could start out a bit awkward, but I'm still in.

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1 minute ago, BurntEyes said:

The chair dance rub and tug could start out a bit awkward, but I'm still in.

Ice cream served in cup sizes A thru DDDD.

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5 hours ago, Johnny Sack said:

I remember certain DQs would have additional menu items depending on location.  Like the owner would just add an enchilada plate or chopped beef sandwiches.  Or various other non-standard DQ items.  Anyone else remember that?

The ones around here have ayce catfish Fridays.

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Is it me, or do the DQ's in West Texas overcook the steak fingers EVERY time? I'm looking at you Ft Stockton! I gave you at least three chances.

I will say the one in Kermit does a decent job, but the line is always too long.

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51 minutes ago, hornhorn said:

Real estate will have some value but usually that is never considered in the EBITDA multiple when buying and selling restaurants. That's because retail real estate isn't priced per sqft but priced how much rent one is willing to pay and what sort of a return a said investor(typically a REIT) is willing to accept since those properties are rarely owned by operators/owners of those restaurants. 

So to answer your question there is some value in the retail real estate but in a small town unless you can replace a DQ with another concept that is going to do equal or better in revenue and indirectly generate equal or better rent via occupancy cost, those locations are may or may not be valuable. 

When I was looking up my cousin, I came across this:

Meanwhile, Diamond Land Company LLC, managed by Donald Feinstein, continues to unload Wendy’s locations, this time selling the 5322 Essen Lane location for $1.5 million to Wendy’s International LLC. In July, Diamond sold to a Slidell developer a vacant building near the Florida Boulevard and Sharp Road intersection that was previously a Wendy’s. And In March, Diamond sold another former Wendy’s restaurant at 3322 Lake St. for $825,000 to an LLC managed by the owners of Louie’s Café. Louie’s has since relocated to that space from its longtime nearby home at 209 W. State St. 

He was an attorney by trade and made his money off of the Wendy's real estate rather than off the profits of his Wendy's. I don't know the EBITDA but those sales prices seem to reflect the value of the properties.

 

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1 hour ago, El Diablo said:

The post below yours inspired me - "Blizzards" could be the name of the titter. Waitress chicks in little fur bikinis and ear muffs. Keep the joint at about 45 deg F.

Post reminded me of Vanessa Angel.

Csql0EmXgAAeTYx.jpg

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As a child, I spent all of my summers and Xmas breaks in Somerville.  My grandmother would take me to the Somerville DQ at least every other day for a Dip Cone, then off to watch the Amtrak come through town.

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When we moved up to NY, wife was excited we found a DQ about an 1 1/2hr away from us, made several trips.  Then they built one just outside of Albany and it sucks, we weren't sure if they mixed up the gravy/ranch on last visit, didn't wtf it was, we know it wasn't edible.  We have since gone back to our original DQ. 

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