GE Franchise Finance Hits the Brakes

Nation’s Restaurant News reported on Friday, and Dow Jones reported today, that GE Franchise Finance is becoming ‘much more selective’ and has stopping making new rate quotes until things ‘settle down.’  They will continue to honor existing commitments.  This follows rumors that BofA declined to make financing available to the McDonald’s Corp. franchise system to fund capex related to its new espresso initiative.

This trend will make it more difficult franchisors to execute “refranchising” initiatives that have been announced not only by Jamba, but also by chains such as Sonic, Jack-in-the-Box, CKE (Carl’s Jr. & Hardee’s), DineEquity (Applebee’s & IHOP), and Panera.

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