It’s honestly a weird feeling seeing the “Now Hiring” sign go down at a place that used to be the king of burgers.
If you’ve been following the headlines, you might have noticed whispers about Five Guys store closures 2026. Now think about that for a second.
At first glance, it feels like a massive failure for the brand.
But if you dig a little deeper—like I’ve tried to do while researching this—it looks less like a total collapse and more like a very aggressive pruning of bad leases.
From what I’ve seen in the industry, when a fast-food giant starts dropping locations, it’s rarely about the food being bad.
People still love those greasy, delicious patties.
It’s almost always about the money.
And in the world of franchising, the money is tighter than it’s been in a decade.
The Lease Trap Most People Don’t See
So, why are people talking about closures now? Well, a lot of these Five Guys locations are approaching their lease renewal dates.
Here is the kicker: a lot of those original leases were signed back when real estate was cheaper.
Now, landlords are coming back to the table asking for huge increases—sometimes double or triple what the franchisees were paying.
Five Guys leases are notoriously tricky.
They’re often structured on triple-net leases, meaning the franchisee pays for everything: taxes, insurance, and maintenance.
If the rent hike is too steep, the math just doesn’t work anymore.
In real situations, a lot of small franchisees are realizing that they are barely breaking even.
They aren’t making a profit to put back into the restaurant, so they shut the doors.
It’s not like corporate is telling them to close, though.
They are fighting it.
I read a few threads where franchise owners are trying to fight for lower rates, but the landlords aren’t budging.
It’s a brutal part of doing business.
Is It Just Five Guys?
Nah, honestly, this isn’t unique to Five Guys.
The entire fast-food sector is feeling the squeeze.
Inflation hit everyone hard.
The cost of beef, buns, and fryer oil? They all went up. Here’s the interesting part.
If you are running a Five Guys, your food cost percentage probably spiked way past the ideal 30% or 33% mark.
When you combine rising food costs with rising rent, you get a recipe for disaster.
Most small business owners are sitting on thin margins. Now think about that for a second.
They can’t absorb a 20% rent hike.
So, they make the hard choice to close up shop and save their cash for something else.
What Does This Mean for Customers?
Look, if you love Five Guys, don’t panic.
I doubt the whole chain is going to vanish.
They are still a powerhouse.
But what we are seeing is a shift. Now think about that for a second.
They are likely going to focus on the best locations—the high-traffic spots where the rent is reasonable or where they own the building.
This means some smaller towns might lose their only burger joint, but the big cities will keep their spots.
It’s a sign of maturity for the brand.
They’ve grown fast, and now they are culling the weak to focus on the strong.
It’s actually a smart move if you ask me, even if it sucks for the local employees who lose their jobs.
Now think about that for a second.
It’s worth noting that if you are thinking about investing in a franchise, you should really be careful right now.
The market is tighter than a drum.
You can’t just buy a spot and expect it to print money like it did ten years ago.
You have to run the numbers on the lease, not just the burgers.
Where to Go Next?
If your favorite spot closes, don’t throw a fit.
There are other players out there.
Places like Shake Shack or even local burger joints are stepping up.
But if you stick around, chances are the location might re-open under a different owner or get a makeover.
The brand is too valuable to let these locations die completely.
Just keep an eye on that “Lease Expiring” sign on the window.
If you see one, you might want to enjoy your last fries while you can.
And this is where things get interesting.
Image source: pexels.com
Image source credit: pexels.com