Montauk Lobster HouseFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Montauk Lobster House franchise requires a total initial investment of $148K – $395K, including a $30K franchise fee and an ongoing 5.0% royalty[2]. The 2023 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: C. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2023 FDD issuance
Overview
- Investment
- $148K – $395K
- 6th pct Service Resta…
- Avg gross sales
- N/A
- 28th pct Service Resta…
- Royalty
- 5.0%
- 7th pct Service Resta…
- Units
- 2
- 6th pct Service Resta…
- SBA default
- N/A
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = >15% above Full-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Started franchising in 2023. Newer systems carry more uncertainty but may offer better territories.
Bottom line
- Total investment $148K – $395K including a $30K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict C (Average) with a risk score of 64/100.
- No Item 19 financial performance representation. Without franchisor-disclosed revenue data, you'll need to gather unit economics directly from existing franchisees.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Montauk Lobster House, Inc.
- Parent company
- None
- CEO title
- CEO
- Diego Flores
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- NY
- HQ
- 716 Montauk Highway, Montauk, NY 11954
- Auditor
- SMITH, BUZZI & ASSOCIATES, LLC
- Audited financials
Overview
About
Franchisees operate casual seafood restaurants, likely centered on lobster dishes and coastal-themed dining. Daily operations include inventory management of fresh seafood, kitchen operations, front-of-house service, staff management, and food cost control in a capital-intensive, labor-dependent restaurant model.
- CEO
- Diego Flores
- Headquarters
- NY
- Founded
- 2021
- FDD year
- 2023
- States available
- 1
FDD Item 7 · 2023 filing · 31 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee (Dine In Restaurant)not refundable | $30K | $30K | |
| Traveling and Living Expenses while Training (Dine In Restaurant) | $500 | $3K | |
| Architectural/Engineering (Dine In Restaurant) | $3K | $6K | |
| Furniture, Fixtures, and Equipment (Dine In Restaurant) | $20K | $40K | |
| Real Property Rent and Security Deposits (Dine In Restaurant) | $9K | $21K | |
| Leasehold Improvements (Dine In Restaurant) | $30K | $100K | |
| Computer and POS System (Dine In Restaurant) | $2K | $4K | |
| Initial Inventory and Supplies (Dine In Restaurant) | $10K | $20K | |
| Signage (Dine In Restaurant) | $3K | $5K | |
| Grand Opening Advertising (Dine In Restaurant) | $3K | $6K | |
| Licenses, Permits, and Certifications (Dine In Restaurant) | $3K | $5K | |
| Insurance (3 Months) (Dine In Restaurant) | $5K | $7K | |
| Professional Fees (Dine In Restaurant) | $750 | $3K | |
| Additional Funds (3 months) (Dine In Restaurant) | $30K | $45K | |
| Initial Franchise Fee (Fast Casual Concept)not refundable | $30K | $30K | |
| Traveling and Living Expenses while Training (Fast Casual Concept) | $500 | $3K | |
| Architectural/Engineering (Fast Casual Concept) | $3K | $6K | |
| Furniture, Fixtures, and Equipment (Fast Casual Concept) | $20K | $40K | |
| Real Property Rent and Security Deposits (Fast Casual Concept) | $18K | $33K | |
| Leasehold Improvements (Fast Casual Concept) | $50K | $150K | |
| Total initial investment | $595K | $1.1M |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $148K – $395K
- Better than avg vs category
- Liquid capital req'd
- $30K – $70K
- Better than avg vs category
- Franchise fee
- $30K – $30K
- Better than avg vs category
- Royalty
- 5.0%
- percentage_of_gross · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 6.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $300 |
| Training fee | $250 |
| Transfer fee | $0 |
| Renewal fee | $0 |
| Total fee load | 6.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Full-Service Restaurants averages
How Montauk Lobster House Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2
- Opened
- 0
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 2
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
- Multi-unit owners
- 12.5%
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 1
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 7 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
A micro-franchise system (2 units) with franchisor going concern issues, zero transparency on unit economics, and no verifiable performance data represents substantial investment risk with inadequate due diligence data.
Litigation (Item 3)
No litigation is required to be disclosed in this Item.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · SMITH, BUZZI & ASSOCIATES, LLC
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 64 / 100 rating
- 01MINOROnly 2 units in system with unknown/likely stagnant growth trajectory raises viability concerns
- 02HIGHGoing Concern status = FALSE indicates potential financial distress or instability at franchisor level
- 03MEDNo Item 19 (average unit volumes) disclosed — inability or unwillingness to share revenue data is critical red flag
- 04MINORNo average net income data provided — impossible to assess actual profitability or ROI on $148K-$395K investment
- 05MEDExtremely limited franchise track record with only 2 locations makes performance validation nearly impossible
- 06MED5% royalty on undisclosed revenue base creates opacity; actual franchisee take-home is unverifiable
- 07MINORRestaurant sector with high operational complexity and typically thin margins (3-9%) — high failure risk
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | radius or population |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Territory radius | 3 mi |
| Territory population | 30,000 |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 25 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | New York |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation is required to be disclosed in this Item.
Items 10, 11
Training & Operations
- Classroom training
- 16 hrs
- On-the-job training
- 76 hrs
- Training location
- On-site and corporate
- Ongoing training
- Required
- POS system
- Harbor Touch POS System
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Harbor Touch POS System
Item 20 · call current owners
Franchisee Contacts
8 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Montauk Lobster House · FDD (2023) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Montauk Lobster House franchise?
The total investment to open a Montauk Lobster House franchise ranges from $148K – $395K, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Montauk Lobster House franchise owners earn?
Montauk Lobster House does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is Montauk Lobster House's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Montauk Lobster House (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Montauk Lobster House franchise locations are there?
As of their most recent FDD filing, Montauk Lobster House has 2 total units in the United States, including 0 franchised units and 2 company-owned units.
Is Montauk Lobster House a good franchise to buy?
FranchiseVerdict rates Montauk Lobster House as a C-grade franchise with a risk score of 64 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.