Russo’s New York Pizzeria Franchise Cost, Revenue & Review 2026
- Investment
- $439K – $1.5M
- Disclosed sales
- $882K
- gross sales, not profit
- SBA charge-off
- Limited · 14 loans
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 →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✓ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored7 of 8 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $439K – $1.5M
- 21st pct Service Resta…
- Avg gross sales
- $882K
- Net sales4th pct Service Resta…
- Royalty
- 6.0%
- 25th 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 median · 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).
- GROWTHNegative: net -1 franchised outlets in the latest year (5 opened, 1 closed); 2 signed but not yet open (Item 20).
- 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
- 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
- $2.6M
- vs $2.5M 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 43% above the typical full-service restaurants franchise.
Source: FDD 2025 · Items 5–7
The filing's Item 7 TOTAL row prints $439,350 to $1,501,000. Its own line items add to $449,350 to $1,501,000. The total is shown as the franchisor printed it; the lines are listed as printed. Filing's own arithmetic: the 21 printed lines sum to $449,350 low / $1,501,000 high; the printed Total (18) row says $439,350 / $1,501,000.
Full Item 7 breakdown21 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee (1) | $35K | $35K | |
| Opening Date Extension Fee (1) | $0 | $10K | |
| In-Store Opening Training (2) | $10K | $50K | |
| Site Evaluation Expenses (3) | $1K | $5K | |
| Lease Payments - 3 Months (4) | $15K | $75K | |
| Ancillary Real Estate Fees (5) | $5K | $10K | |
| Architectural (6) | $12K | $25K | |
| Engineering (6) | $4K | $10K | |
| Plan Review Fee (6) | $500 | $500 | |
| Leasehold Improvements (7) | $150K | $750K | |
| Signage (8) | $5K | $40K | |
| Retail Equipment / Delivery Vehicle (9) | $130K | $270K | |
| Electronic Cash Register with Modem (10) | $19K | $40K | |
| Facsimile Machine | $350 | $500 | |
| Business Licenses & Permits (Not Including Alcohol License) (11) | $5K | $10K | |
| Professional Fees (12) | $3K | $5K | |
| Insurance Deposits and Premiums (13) | $5K | $20K | |
| Initial Inventory (14) | $10K | $30K | |
| Travel, Lodging and Meals for Initial Training (15) | $10K | $40K | |
| Grand Opening Advertising Program (16) | $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%
- 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 |
| Inventory (initial) | $10K – $30K |
| Total fee load | 7.5% of rev |
What do units actually make?
Average unit sales run 45% below the full-service restaurants norm.
Reported as net sales, not gross sales
Source: FDD 2025 · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Russo’s New York Pizzeria until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$1.0M
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
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, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own 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?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
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%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
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 outlets
- vs category median 18
- Range (low → high)
- $428K→$1.6MCited, not corroborated — printed on page 45 of the 2025 FDD. Nothing else in our record independently restates or re-derives it.
- 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 801 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 median).
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 medians
How Russo’s New York Pizzeria Compares
Category median of published Full-Service Restaurants brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
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
Last fiscal year · Item 20 exits and transfers
- Terminated
- 4
- Not renewed
- 0
- Transferred
- 7
- Reacquired
- 1
- Franchisor bought back
- Signed, not yet open
- 2
- 0.06 per open outlet · Item 20 Table 5
- 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.
Where the owners are · Item 20 owner list
13 current owners across 5 states.
- TX 8
- OK 2
- AZ 1
- CA 1
- FL 1
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
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
- Limited · 14 loans
- Limited SBA coverage: 14 loans, rate hidden until 10 have resolved and loans reach 2% of franchised units
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- Limited · 14 loans
- 5-yr charge-off
- Limited · 14 loans
- 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.
Lender network · 7(a) + 504
SBA Lending Report
Full lending analysis for Russo’s New York Pizzeria from SBA 7(a) FOIA data.
- Avg interest rate
- 8.18%
- Avg chargeoff amount
- $50K
- Jobs supported
- 222
Top SBA lenders
| # | Lender | Loans | Volume | Default % |
|---|---|---|---|---|
| 1 | The Huntington National Bank | 2 | N/A | N/A |
| 2 | Gulf Coast Bank and Trust Company | 2 | N/A | N/A |
| 3 | Citizens Bank | 2 | N/A | N/A |
| 4 | Central Pacific Bank | 2 | N/A | N/A |
| 5 | PlainsCapital Bank | 1 | N/A | N/A |
Geographic failure vector
| State | Loans | Defaults | Rate |
|---|---|---|---|
| TXTexas | 10 | 0 | -- |
| OROregon | 2 | 0 | -- |
| CACalifornia | 1 | 0 | -- |
| FLFlorida | 1 | 0 | -- |
SBA 7(a) lending trend
Borrower profile
Source: SBA 7(a) + 504 FOIA loan-level data, matched by FranchiseVerdict
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)
Subject: the franchisor is a named party (defendant).
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)
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
- 01MINORCA DFPI enforcement consent order for unregistered franchise sales
- 02MINORNegative 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 | Protected territory |
| 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 |
| Termination groundsℹ | 14 |
| Curable defaultsℹ | 6 |
| 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
- Site selection
- franchisee_with_franchisor_approval
- Franchisor financing
- Not offered
- Item 10
- 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
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. Important context: Reported as net sales, not gross sales. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
Who owns Russo’s New York Pizzeria?
Russo’s New York Pizzeria is franchised by New York Pizzeria Incorporated. Source: FDD Item 1, 2025 filing.
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). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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?
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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.