VOL. 111 | NO. 230 | Wednesday, December 10, 1997
Wolf Creek Parkway to get IHOP
Wolf Creek Parkway to get IHOP
Pancake restaurant company
expands with three stores
in Memphis in past two years
By CAMILLE H. GAMBLE
The Daily News
Construction has started on the third International House of Pancakes being developed in the Memphis market in the past two years.
The new restaurant will be located at 2810 Wolf Creek Parkway in an outparcel of the Market of Wolf Creek shopping center, a 575,000-square-foot retail development by Trezevant Realty.
The construction value of the project is $737,000, according to a building permit issued by the Shelby County Construction Code Enforcement Office. W.H. Bass Inc. is the general contractor.
Also currently under construction is an IHOP at 2060 Union Ave. in Midtown. That store is being built by IHOP Corp., and BD&T Inc. is the general contractor, according to a building permit issued Oct. 7.
Ken Hoerster, vice president of retail development for Trezevant, is the exclusive broker for IHOP.
He said IHOP officials believe the property at Wolf Creek will be ideal for attracting morning traffic.
"Breakfast is their big meal of the day, and they are on the going-to-work side of Germantown Parkway for people coming from the north, east and west and filtering to Germantown Parkway on their way to I-40," Hoerster said.
The two new IHOP stores in Memphis are being built by IHOP Corp. but may be subleased to franchisees.
"We are a franchise owner. We dont build them for operating. We operate a few of them, but those are unique situations," said Richard Herzer, president and chief exectuive officer of IHOP.
"There is a good reason for that. We think that franchisees will give a better dining experience for our guests. They are on the territory and involved in the business, and that is very important."
IHOP Corp. purchased land at Perkins and Showcase Boulevard in August 1996 to build Memphis first International House of Pancakes since the early 1980s.
"We are entering or re-entering about two or three markets per year," Herzer said. "Our primary thrust is backfilling, which means putting restaurants back into markets where we already are to maximize our television reach.
"If we have good success with the stores we are putting in Memphis now, we will probably change the development schedule," he said. "I would imagine that we should have four or five restaurants in that market to be very effective."
IHOP Corp. went public in the last 60s, went private in 1981 and went public again in 1991, Herzer said.
For the quarter ended Sept. 30, IHOPs net income increased 6.4 percent to $5.73 million, or 58 cents per share compared with $5.38 million or 56 cents per share last year. For the nine months ended Sept. 30, net income increased 11.7 percent to $14.32 million, compared to last years $12.82 million. Net income per common share was $1.48 vs. $1.34 for the same period a year ago.
"We are particularly pleased with our franchise operations results in the third quarter of 1997," Herzer said. "Our revenues from franchised operations grew 13.8 percent over the third quarter of 1996, and our margin on those revenues improved to 55.1 percent from 53.7 percent a year ago."
During the third quarter, IHOP opened 17 new restaurants, bringing the total for the first nine months to 38. IHOP plans to open approximately 65 to 70 new restaurants in 1997.