SAN DIEGO – Fast-casual Mexican restaurant operator Qdoba is continuing its expansion push, announcing in December that it signed deals to develop 87 restaurants in New York, New Jersey and Pennsylvania.
The news follows an earlier announcement about expansion in the western United States. B Wild Investments LLC, the private investment office of Barry W. Dubin, plans to develop 50 new restaurants in Utah, Nevada, Colorado, New Mexico and Alaska.
And in California, Qdoba recently signed an agreement with “a strong restaurant group” north of Los Angeles to add more stores, said Jeremy Vitaro, chief development officer, in an interview last week (Jan. 14). He declined to give further details because they were not yet public.
Total system sales were $1.3 billion last year. “We’re growing at a healthy clip,” said Vitaro. Same store sales are up, and new unit growth is also driving the company.
Eighty percent of Qdoba restaurants are operated by multi-brand franchisees, with the balance run by the company.
Mission Valley-based Qdoba has 830 locations in 45 states, plus 14 in Canada, one in Japan and four in Puerto Rico. The business has commitments to open 650 more stores. It plans to open 100 restaurants annually, beginning in 2027, and roughly double its U.S. footprint by 2032.
$527M Helps Expansion Effort
Helping with this expansion plan is $527 million raised by Butterfly, the Los Angeles-based private equity firm that bought Qdoba in 2022. The lead investor was Apollo S3, aka Apollo’s Sponsor and Secondary Solutions business. Butterfly announced the investment in August.
With new capital in hand, the business remodeled half of its corporate stores, bringing them up to the new image and standard, Vitaro said.
Many of the partners for the East Coast push, announced in December, operate several brands of franchise restaurants. In many cases, the multi-unit partners are adding Mexican fast casual to portfolios built around brands such as Applebee’s, Panera Bread and Dunkin’.
Newly announced partners include The Rose Group, which signed a 35-restaurant development agreement with Qdoba, spanning key markets in Pennsylvania and Southern New Jersey. The Rose Group bills itself as the 109th largest restaurant franchise company in the United States. It operates 55 Applebee’s Grill + Bar restaurants and Shannon Rose Irish Pubs across the Mid-Atlantic region.
Qdoba also said it signed a 27-restaurant development agreement with Doherty Enterprises across Northern and Central New Jersey and New York’s Hudson Valley and Capital Region. Doherty Enterprises operates more than 140 restaurants across several brands, including Applebee’s and Panera. Qdoba said its partner has a long track record of scaling concepts across the Northeast and Southeast.
In addition, Qdoba said it expanded its development agreement with Cafua Management Co. with an incremental 25-restaurant commitment across Central and Upstate New York, including the Finger Lakes and Mohawk Valley. Cafua Management Co. is the largest private Dunkin’ franchisee in the world, with more than 200 locations.
Also in the December statement, Qdoba said it has expanded its relationship with The Tattva Group led by Neil Patel, a 75+ unit multi-brand operator across brands including Dunkin’, Little Caesars, Buffalo Wild Wings GO and Jimmy John’s. It acquired Qdoba restaurants in South-Central Pennsylvania and signed on for additional development in the region.
Qdoba has about a dozen California restaurants, including a location in Mission Valley and another at San Diego International Airport. The business began in Colorado, where it now counts 92 locations. Qdoba is still finding places to expand in its native state, Vitaro said.
The business has an average unit volume (AUV) of $1.7 million, and boasts a top quartile AUV of $2.57 million. Restaurants use AUV (total system sales divided by number of stores) as a measurement of how well the business is doing.
In other news, Qdoba named Cathy Tang its chief legal officer, making the announcement earlier this month (Jan. 12). Tang most recently served as chief legal officer and corporate secretary at Pursuit Attractions and Hospitality Inc. following her tenure as chief legal officer and corporate secretary at Krispy Kreme Inc. At one time, she worked for Qdoba CEO John Cywinski when both were at KFC Corp.
Qdoba
FOUNDED: 1995, as Zuma Fresh Mexican Grill
CEO: John Cywinski
HEADQUARTERS: San Diego (Mission Valley)
BUSINESS: Fast casual-Mexican restaurants
EMPLOYEES: 110 corporate full-time equivalents in San Diego
REVENUE: $1.3 billion total system sales last year
WEBSITE: qdoba.com
CONTACT: contactus.qdoba.com
NOTABLE: At one time, Qdoba was a subsidiary of a longtime San Diego quick-service restaurant opera-tor Jack in the Box
