Are there any specific requirements for site selection under the Del Taco Development Agreement?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
the applicable Franchise Agreement. In all other circumstances, Del Taco will retain any and all Extension Fees.
- (d) Any amount owing from the Developer to Del Taco pursuant to this Section 5, if not paid when due, shall bear interest at the rate of seven percentage points in excess of the prime rate per annum, subject to any applicable limits imposed by California law, after the due date until paid.
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- Services by Del Taco. Del Taco shall provide to the Developer one copy of the following:
- (a) Del Taco's standard site selection criteria as then in effect;
- (b) Sample site plans and layouts; and
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- (c) A standard construction package (which Del Taco may modify from time to time), including (without limitation) plans and specifications, with the understanding that the Developer shall adapt the plans and specifications, at the Developer's expense, for use at any approved site.
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- Site Selection. The Developer shall complete and submit the forms and information that Del Taco requires from time to time in connection with any proposed site for a Del Taco restaurant. In addition, the Developer shall submit financial information relating to the Developer's then-current financial condition and the expected development costs and projected results of operation of the Restaurant proposed for development on the proposed site. Within 45 days after its receipt of all of the required information,
Del Taco shall approve or reject any proposed site by written notice to the Developer. Del Taco shall not approve or reject a proposed site until the Developer has provided it with the required forms and information. Del Taco shall have the right to refuse to approval any site if (i) the site does not conform with general site selection criteria Del Taco establishes from time to time, including, without limitation, demographic characteristics, traffic patterns, parking accommodations, character of the neighborhood, competition from other businesses, or any reasonable conditions as determined by Del Taco in its sole discretion; (ii) the Developer fails to meet Del Taco's then-current financial and operational requirements for developers, franchisees and/or the development of Restaurant; or (iii) if the Developer is in default under this Agreement or any other agreement with Del Taco. Del Taco's approval of any site shall not constitute any representation, warranty, or guarantee by Del Taco that the site will constitute a successful location for a Restaurant. In addition, Del Taco shall have the right to refuse to approve any site that is within one mile of a Restaurant located or proposed for development outside of the Development Area, if any, or in accordance with Del Taco's then-current business impact policy, including if Del Taco otherwise determines that the proposed site will have a substantial negative financial impact on a Restaurant located or proposed for development outside of the Development Area. As a condition of Del Taco's review of a proposed site, Del Taco may require Developer to pay for (or reimburse Del Taco for the costs of) a trade area survey analysis if the proposed site is within certain distance of any existing Restaurant as specified in Del Taco's then-current business impact policy.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the Development Agreement outlines specific requirements and processes for site selection. Del Taco provides the Developer with its standard site selection criteria, sample site plans, and a standard construction package. The Developer is responsible for adapting these plans to the approved site at their own expense.
The Developer must submit all required forms and information related to the proposed site, including financial information about their current financial condition, expected development costs, and projected operational results for the restaurant. Del Taco has 45 days to approve or reject the proposed site after receiving all required information. Del Taco may refuse approval if the site does not meet its general site selection criteria, such as demographic characteristics, traffic patterns, parking, neighborhood character, and competition, or if the Developer fails to meet Del Taco's financial and operational requirements.
Del Taco's approval of a site does not guarantee its success. The Developer is solely responsible for acquiring, developing, and constructing the restaurant on the approved site. Before construction can begin, Del Taco must approve the site, the Developer must have the legal right to use the site, and Del Taco must approve the Developer's general contractor and architect. Furthermore, Del Taco retains the right to refuse approval for any site within one mile of an existing or proposed Del Taco restaurant outside the Development Area if it determines the new site would have a negative financial impact. Del Taco may also require the Developer to pay for a trade area survey analysis and potentially make a business impact payment to affected franchisees as a condition of site approval.