Russo’s New York Pizzeria Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Russo's New York Pizzeria is a casual-dining franchise serving New York-style pizza, pasta, and Italian dishes. Franchisees run the restaurants, managing the kitchen, dining service, and staffing.
FranchiseVerdict summary · 2026
A Russo’s New York Pizzeria franchise requires a total initial investment of $439K – $1.5M, including a $35K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $882K[2]. FranchiseVerdict grade: F (Weakest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $439K – $1.5M
- 21st pct Service Resta…
- Avg gross sales
- $882K
- Net sales3rd pct Service Resta…
- Royalty
- 6.0%
- 24th pct Service Resta…
- Units
- 34
- 24th pct Service Resta…
- SBA charge-off
- N/A
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Full-Service Restaurants avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $439K – $1.5M including a $35K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $882K/year (median $834K).
- RISKVerdict F (Weakest tier), verdict score 25/100 (higher is better).
- FLAGAuditor disclosed a going-concern note, which flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- New York Pizzeria Incorporated
- Ultimate parent
- None
- CEO title
- President and Chief Executive Officer
- Gerardo Anthony Russo
- CEO experience
- 26 yrs
- Years in role or industry
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- Texas
- HQ
- 5120 Woodway Drive, Suite 8030, Houston, Texas 77056
- Auditor
- Muhammad Zubairy, CPA PC
- Audited financials
- Franchisor revenue
- $2.5M
- vs $2.6M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
- ⚠ Going-concern note
- Disclosed in FDD 2025
- Auditor flagged doubt about continued operations. Verify against the latest FDD before deciding.
Overview
About
- CEO
- Gerardo Anthony Russo
- Headquarters
- TX
- Founded
- 1998
- FDD year
- 2025
- States available
- 5
Can you afford it, and what does the money buy?
Entry cost runs 17% below the typical full-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown21 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $35K | $35K | |
| Opening Date Extension Feenot refundable | $0 | $10K | |
| In-Store Opening Trainingnot refundable | $10K | $50K | |
| Site Evaluation Expenses | $1K | $5K | |
| Lease Payments - 3 Months | $15K | $75K | |
| Ancillary Real Estate Fees | $5K | $10K | |
| Architectural | $12K | $25K | |
| Engineering | $4K | $10K | |
| Plan Review Fee | $500 | $500 | |
| Leasehold Improvements | $150K | $750K | |
| Signage | $5K | $40K | |
| Retail Equipment / Delivery Vehicle | $130K | $270K | |
| Electronic Cash Register with Modem | $19K | $40K | |
| Facsimile Machine | $350 | $500 | |
| Business Licenses & Permits | $5K | $10K | |
| Professional Fees | $3K | $5K | |
| Insurance Deposits and Premiums | $5K | $20K | |
| Initial Inventory | $10K | $30K | |
| Travel, Lodging and Meals for Initial Training | $10K | $40K | |
| Grand Opening Advertising Program | $10K | $25K | |
| Total initial investment | $449K | $1.5M |
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
- $439K – $1.5M
- Top 40% of category vs category
- Liquid capital req'd
- $20K – $50K
- Top 40% of category vs category
- Franchise fee
- $35K – $35K
- Top 40% of category vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 7.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Training fee | $500 |
| Transfer fee | $12K |
| Renewal fee | $12K |
| Total fee load | 7.5% of rev |
What do units actually make?
Average unit sales run 49% below the full-service restaurants norm.
Reported as net sales, not gross sales
Source: FDD 2025 · Item 19
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$97K
11.0% margin
Unlevered ROIC
10%
EBITDA / total invested capital
Payback
10.4 yrs
cash-on-cash, unlevered
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Russo’s New York Pizzeria unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
10%
Below the 30–60% attractive-franchise band
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Russo’s New York Pizzeria units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$706K
on $3.5M purchase
Total debt
$2.8M
SBA $1.8M + senior + seller note
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2025 FDD
Financial Performance
Reported as net sales, not gross sales
- Avg gross sales
- $882K
- Per unit, per year
- Median gross sales
- $834K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- net sales
- Sample size
- 25
- vs category median 18
- Range (low → high)
- $428K→$1.6M
- Cohort dispersion (min → max)
- Quartile band
- $518K→$1.3M
- Bottom 25% → top 25%
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 4 / 10
- vs category median 3 / 10 · above
Compared against 805 Full-Service Restaurants brands
Revenue is only 0.9x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $882K/year in gross sales. Revenue-to-investment ratio: 0.9x.
Fee burden
Total ongoing fee load of 7.5% (near the Full-Service Restaurants average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System contracting at -3.4% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
Multi-unit rate
50% of franchisees own multiple units, a moderate multi-unit rate.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Full-Service Restaurants averages
How Russo’s New York Pizzeria Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 34
- Opened
- 5
- Last reporting year
- Closed
- 1
- Terminated
- 4
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 17.9%
- Company-owned
- 6
- Corporate units in the system
- % franchised
- 82%
- vs corporate-owned
- Multi-unit owners
- 50.0%
- Net growth (3-yr)
- -3.4%
- Net unit change over 3 years
- 3-yr CAGR
- -3.4%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 5
- Closed (3yr)
- 1
- Terminated (3yr)
- 4
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 7
- Reacquired (3yr)
- 1
- Franchisor bought back
- Projected new
- 6
- Franchisor's next-year forecast
- Transfer rate
- 20.6%
- Owners selling to other franchisees
- Termination rate
- 11.8%
- Franchisor-initiated terminations
- Ceased ops
- 11.8%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 5 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.
- Total loans
- 14
- Loan volume
- $8.6M
- Median loan
- $618K
- average
- Charge-off rate
- N/A
- no resolved loans yet — rate needs a terminal outcome
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 10
- Defaults
- 1
- Typical loan rate
- 8.2%
- avg rate to borrowers
- vs industry
- N/A
- Jobs supported
- 222
- Lender concentration
- N/A
Borrower mix: 63% went to startups / new businesses, 37% to established operators
Top lenders financing Russo’s New York Pizzeria franchisees
Showing 3 of 10 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Russo’s New York Pizzeria's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 5 lenders with concentration factor
- Per-state charge-off rates across 4 states
- Startup risk premium and job creation velocity
- 7-year lending trend
Instant access. No subscription.
What could kill this investment?
The auditor flagged going-concern doubt (Item 21) — the single biggest risk here.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Russo's carries a going-concern note plus deeply negative net worth of -$899,158 despite positive net income of $411K. A CA DFPI consent order (unregistered franchise sales, $2,500 fine, paid) and a franchisor-plaintiff arbitration enforcement add regulatory/litigation weight, and units declined 3.4% to 34. The auditor-flagged going concern combined with large negative equity is the driving risk.
Litigation (Item 3)
Commissioner of Financial Protection & Innovation vs. New York Pizzeria Inc. (settled Jan 27, 2022, $2,500 penalty for Corporations Code 31110 violation); New York Pizzeria Inc. vs. Shimon Bohbout et al. (269th Judicial District Court Harris County Texas, Case 2024-46271, judgment awarded July 24, 2024, garnishment proceedings ongoing against Bank of America and JP Morgan Chase Bank, ANZ Banking Group garnishment dismissed Dec 9, 2025)
Largest disclosed settlement: $2,500
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Muhammad Zubairy, CPA PC⚠ Going-concern note flagged
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: No
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 25 / 100 verdict
- 01MINORgoing_concern_note=true with net worth -$899,158
- 02MINORCA DFPI enforcement consent order for unregistered franchise sales
- 03MINORNegative net unit growth -3.4%, 34 units
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 7.5% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 1 mi |
| 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 | 20 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Harris County, Texas |
| Jury trial waiver | Yes |
| Governing law | Texas |
| Litigation count | 2 |
View Item 3 litigation summary
Commissioner of Financial Protection & Innovation vs. New York Pizzeria Inc. (settled Jan 27, 2022, $2,500 penalty for Corporations Code 31110 violation); New York Pizzeria Inc. vs. Shimon Bohbout et al. (269th Judicial District Court Harris County Texas, Case 2024-46271, judgment awarded July 24, 2024, garnishment proceedings ongoing against Bank of America and JP Morgan Chase Bank, ANZ Banking Group garnishment dismissed Dec 9, 2025)
Items 10, 11
Training & Operations
- Classroom training
- 200 hrs
- On-the-job training
- 200 hrs
- Training location
- headquarters
- Ongoing training
- Required
- POS system
- Micros POS or Toast POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Micros POS or Toast POS
Item 20 · call current owners
Franchisee Contacts
13 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Russo’s New York Pizzeria · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Russo’s New York Pizzeria franchise?
The total investment to open a Russo’s New York Pizzeria franchise ranges from $439K – $1.5M, with an initial franchise fee of $35K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Russo’s New York Pizzeria franchise owners earn?
According to Item 19 of the Russo’s New York Pizzeria FDD, the average gross sales per unit is $882K. The median is $834K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Russo’s New York Pizzeria FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Russo’s New York Pizzeria FDD and qualifies whose outlets they describe.
What is Russo’s New York Pizzeria's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Russo’s New York Pizzeria (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 Russo’s New York Pizzeria franchise locations are there?
As of their most recent FDD filing, Russo’s New York Pizzeria has 34 total units in the United States, including 28 franchised units and 6 company-owned units. 5 new units were opened in the latest reporting year.
Is Russo’s New York Pizzeria a good franchise to buy?
FranchiseVerdict rates Russo’s New York Pizzeria as a F-grade franchise with a verdict score of 25 out of 100 (higher is better), 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
Are you the franchisor?
If you represent Russo’s New York Pizzeria, you can request corrections or provide updated information.
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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.