Restaurant Debt Braces for a Record as Industry Growth Slows
- Franchisees bet on expensive expansion in a stagnating market
- ‘There’s a problem, and it’s getting worse,’ one expert says
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The restaurant industry is bracing for a reckoning as a record tide of debt threatens to choke franchisees of major chains like Pizza Hut and Burger King.
Like other industries, restaurants have taken advantage of more than a decade of ultra-low interest rates and levered up to build new locations -- or sometimes simply to reward shareholders. That’s a change from past decades, when restaurant debt levels were low compared with other industries.