Chick-fil-A will return to Iowa State University’s Memorial Union after the Iowa Board of Regents approved a lease agreement Wednesday for the restaurant to open in the building’s food court area.
The restaurant will occupy approximately 2,085 square feet on the first floor of the MU. The space is adjacent to the food court, the ISU Book Store and the Soults Family Visitor Center. Chick-fil-A will also be able to operate portable, temporary kiosks on campus grounds.
During the Regents meeting, Senior Vice President for Operations and Finance Sean Reeder said the decision was driven by student interest.
“This is particularly attractive for our students,” Reeder said. “Polling by the dining and Memorial Union staff shows students frequently ask for more national brands within our product offerings. Chick-fil-A is immensely popular with our student population, as well as faculty and staff.”
The approved lease includes an initial 10-year term with one mutually agreed-upon five-year renewal option, allowing for a potential of 15 years.
“The terms of the lease are a 10-year lease with a mutually agreed-upon five-year renewal for a total of 15 years,” Reeder said. “The rent we would receive is in the form of commission on net sales at 4% in years one through five, escalating to 10% in years six through 10, and that would also be the rate if the renewal was approved. And there is an additional 2.5%on food and beverage sales that are purchased with student dining dollars.”
According to Board of Regents documents, Chick-fil-A will be responsible for maintenance, repairs and utilities for the location. The company will pay commission on all sales channels except catering deliveries made outside of the Memorial Union.
As part of the agreement, Iowa State will provide a one-time payment of $750,000 to support infrastructure and system upgrades required for the renovation. All improvements must be reviewed and approved by the university and the Iowa Department of Inspections, Appeals and Licensure before work begins.
