Item 2. Properties
Item 2. Properties.
Corporate Offices
Our principal offices are in leased office space in West Fargo, North Dakota with additional leased space in Minnetonka, Minnesota. Both locations are leased on a month-to-month basis for a total of $1,800 per month.
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Burger Time Properties
The table below provides basic information about each of our Burger Time restaurants.
Location
Open Since
Building
(Approx. Sq. Ft.)
Land
(Sq. Ft.)
Real Estate
Owner
Restaurant
Business Owner
Fargo, North Dakota
1987
600
35,000
BTND, LLC
BTND, LLC
Moorhead, Minnesota
1988
600
22,680
BTND, LLC
BTND, LLC
Grand Forks, North Dakota
1989
650
29,580
BTND, LLC
BTND, LLC
Waite Park, Minnesota
1989
700
17,575
BTND, LLC
BTND, LLC
Bismarck, North Dakota
1989
600
30,750
BTND, LLC
BTND, LLC
Sioux Falls, South Dakota
1991
650
17,688
BTND, LLC
BTND, LLC
Sioux Falls, South Dakota (1)
1991
650
15,000
Leased
BTND, LLC
Minot, North Dakota
1992
800
33,600
BTND, LLC
BTND, LLC
Ham Lake, Minnesota (2)
2015
1,664
31,723
BTND DQ, LLC
BTND DQ, LLC (3)
West St. Paul, Minnesota (6)
Sold 2023
1,020
18.280
SOLD
SOLD
Richmond, Indiana (4)(5)
held for sale
1,062
23,086
BTND IN, LLC (4) (5)
BTND, LLC
Hazelwood, Missouri (5) (7)
held for sale
1,566
51,386
BTND MO, LLC (5)
BTND MO, LLC (5)
___________
(1)
The land is leased from a third party.
(2)
Dairy Queen franchise.
(3)
Restaurant operations are 99% owned by BTND, LLC, and 1% owned by the current restaurant manager.
(4)
Restaurant operations closed in December 2018.
At
Property for sale.
(6)
The West St. Paul property was sold for $496,000, and the sale closed in the first quarter of 2023 with a gain on sale of approximately $313,000.
(7)
The Company is in the process of abandoning the Hazelwood, Missouri, property in lieu of paying property taxes. This abandonment is expected to be completed in the second quarter of 2023 at which time the Company will recognize a gain of approximately $180,000 upon the final disposition of the property.
A description of our restaurant properties appears above under the heading “BUSINESS—Locations.” We lease our executive offices, consisting of approximately 1,000 square feet, located at 405 West Main Street, West Fargo, North Dakota, on a month-to-month basis at the cost of $500 per month. In addition, effective January 2, 2022, we have agreed to reimburse Brimmer Company, LLC, an affiliate of the Company, for the monthly rent of $1,250 on 1100 square feet in Minnetonka, Minnesota, at 10501 Wayzata Blvd Ave S, Suite 102 where administrative activities are performed. Our office space is adequate for its intended purposes and our near-term expansion plans.
On June 28, 2021, we refinanced our BTND mortgage debt, bearing interest at 4.75%. As of January 1, 2023, we had $2,826,093 in contractual obligations relating principally to amounts due under mortgages on the real property on which our Burger Time restaurants are situated. Our monthly required payment is approximately $22,700.
We currently lease the land for one of our Sioux Falls, South Dakota, Burger Time locations on a month-to-month basis, and the monthly rent is $1,600.
Keegan’s Restaurant
Concurrent with our acquisition of Keegan’s assets in March 2022, we entered into a 132-month triple-net lease for the property occupied by Keegan’s with an unrelated landlord. Terms of the lease provide for an initial rent of $5,000 per month, increasing annually at the greater of 3% or the increase in the Consumer Price Index over that period. The location comprises approximately 2,900 square feet of dining, kitchen, and storage space and includes typical features for a full-service restaurant.
Pie In The Sky Restaurant
Concurrent with our purchase of PIE assets in May 2022, we entered into a five-year triple-net lease for the property occupied by PIE with the seller of the assets that provides us with three five-year extensions at our option. Terms of the lease provide for an initial rent of $10,000 per month, increasing annually to approximately $11,000 per month during the first five-year term. The location comprises approximately 3,500 square feet of dining, kitchen and storage space on two levels, with a production kitchen and storage and office space on the lower level; there is also approximately 1,500 square feet of outdoor dining, which is serviced by an outdoor service bar. The landlord granted us a right of first refusal to purchase the property on terms it receives from a third party during the entire term and any lease extension.
Village Bier Garten Restaurant
Concurrent with our acquisition of the Village Bier Garten assets, we entered a five-year lease with the seller for approximately 3,000 square feet of restaurant space and access to an additional 3,000 square feet of shared entertainment and seating area and includes all of the features typical for a full-service restaurant. The terms of the triple-net 60-month lease provide for an initial rent of $8,200 per month with an annual escalation of 3%. The lease includes three five-year renewal option periods.
Item 3. Legal Proceedings.
We are not presently a party to any material litigation, nor, to the knowledge of management, is any litigation threatened against us that may materially affect us.
Item 4. Mine Safety Disclosures.
Not applicable.
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PART II