Why McDonald’s Is Actually a Real Estate Company

When you picture McDonald’s, burgers, fries, and golden arches towering over you are probably what come to mind. But what if I told you McDonald’s makes most of its money not from selling food... but from renting land?

Yep. McDonald’s is actually one of the biggest real estate companies in the world.

How it works.

1. McDonald’s finds a spot to open a restaurant.

2. They buy the land.

3. They build (or lease) a restaurant building.

4. A franchise owner pays:

   • A fee to run the McDonald’s brand.

   • Rent for the land/building.

   • A cut of their profits to McDonald’s.

The numbers behind the strategy.

• McDonald’s owns over 30,000 properties around the world.

• In some years, over 60% of its profit comes from real estate, not food.

• It’s been called a “real estate business disguised as a fast-food chain.”

Why is it so effective?

• Land usually goes up in value.

• Even if a restaurant fails, McDonald’s still owns the land.

• Franchisees take most of the business risk, but McDonald’s gets the rent either way.

So, next time you drive by a McDonald’s, look past the fries and McFlurries. You're looking at one of the smartest real estate companies on Earth (that just happens to sell hamburgers).