CEC Entertainment, the parent of Chuck E. Cheese, filed for Chapter 11 bankruptcy protection in June 2020 and has since emerged as a privately held company, CEC Entertainment, LLC. S&P Global Ratings withdrew its issuer credit rating on CEC Entertainment LLC on October 23, 2025, at the company’s request after its private refinancing; when withdrawn, the rating was below investment grade and on CreditWatch with negative implications, which S&P said it could not resolve for lack of information on the new capital structure. A withdrawal is not an upgrade and does not mean lease risk has gone away, and we have not verified a current Moody’s rating from a primary source. The company has cited positive same-store sales momentum after completing its remodel program (September 2025). In September 2025, the company closed a $625 million private credit term loan and, with cash on hand, used it to redeem its $650 million Senior Secured Notes due May 2026. For NNN investors, the company reports operating momentum, but there is no current S&P rating to underwrite against, and the specialized family entertainment format (Chuck E. Cheese venues averaged about 12,700 SF in CEC’s fiscal 2019 Form 10-K) carries meaningful alternative-use challenges.
| Metric | Details |
|---|---|
| Parent / Legal Entity | CEC Entertainment, LLC |
| Credit Ratings | No current S&P rating: S&P withdrew its issuer credit rating on October 23, 2025, at the company’s request; no current Moody’s rating verified from a primary source |
| Investment Grade Status | Not Yet Verified |
| Sector | Family Entertainment & Dining |
| Ownership | Private; CEC stopped filing SEC reports in 2020 (Form 15, June 25, 2020) |
| Venue count (systemwide) | 657 venues as of September 29, 2025: 501 company-operated and 156 franchised, in 45 states and 17 foreign countries and territories (all CEC brands); the company’s investor relations page listed 675+ venues in October 2026 |
| Geographic Concentration | Company-operated venues in 44 states and Canada (September 29, 2025); headquarters in Irving, Texas |
| Median asking cap rate | See the live table below |
| Typical Lease Term Remaining | Varies; confirm in the lease and any post-2020 amendments |
| Guarantee Type | Varies; confirm the tenant entity and any guaranty in the lease |
| Typical Building Size | About 12,700 SF average for Chuck E. Cheese venues (fiscal 2019 Form 10-K) |
Chuck E. Cheese Business Overview & NNN Investment Profile
CEC Entertainment, LLC is the parent company of Chuck E. Cheese, a family entertainment and pizza dining chain with nearly 600 fun centers (September 2025), and Peter Piper Pizza, a smaller brand concentrated in Texas, the Southwest and Mexico. The company filed for Chapter 11 bankruptcy protection in June 2020 as the pandemic shut down the on-premise family entertainment business. It has since emerged from bankruptcy as a privately held company. As of September 29, 2025, the company operated 501 venues and its franchisees operated 156, a total of 657 venues in 45 states and 17 foreign countries and territories.
For NNN investors, Chuck E. Cheese is a post-bankruptcy, privately owned operator in active turnaround mode; Scott Drake, previously its chief financial officer, was named CEO in 2026. The company says it has spent more than $300 million remodeling its fun centers; it has also removed the animatronic band from all but six legacy locations, expanded active play such as trampoline zones, and launched a membership program. In September 2025, its chief financial officer cited positive same-store sales momentum from these initiatives. However, S&P withdrew its below-investment-grade rating on CEC in October 2025, and the company operates in a format (large-box family entertainment) that can carry elevated alternative-use costs, which vary by site. For comparison, AMC Theatres currently carries B- in our ratings database (not investment grade); see our tenant credit ratings for other tenants.
Chuck E. Cheese Credit Rating Analysis
Chuck E. Cheese: no confirmed agency rating. A rating is shown here only after an agency rating action or an issuer filing confirms it. Without an agency rating, lease credit is assessed from financial statements and any guarantee in the lease. Ratings checked October 8, 2026. See the investment grade credit tenant ratings table.
S&P Global Ratings withdrew its issuer credit rating on CEC Entertainment LLC on October 23, 2025, at the company’s request following the completion of its private refinancing. The rating, which was below the BBB- investment-grade threshold, was then on CreditWatch with negative implications, and S&P said it could not resolve the CreditWatch for lack of information on the new capital structure. A withdrawal is not an upgrade and is not evidence that lease risk has gone away.
Source: S&P Global Ratings rating action, October 23, 2025 (issuer credit rating on CEC Entertainment LLC withdrawn at the company’s request).
Because S&P’s rating on CEC was withdrawn, there is no current S&P grade to compare with family entertainment and fitness peers. Planet Fitness, Dave & Buster’s and Topgolf are other large-format entertainment and fitness tenants; the comparable tenants table below shows what our ratings database holds for each, and any rating should be confirmed with the agency or the company’s filings before you rely on it. For detailed analysis of how credit tiers drive cap rate spreads across the net lease market, see the investment grade guide.
Chuck E. Cheese NNN Lease Structure
Before the bankruptcy, CEC reported that most of its leases had initial terms of 10 to 20 years with one or more renewal options and generally required it to pay minimum rent, property taxes, insurance and other maintenance costs (fiscal 2019 Form 10-K); escalations varied by lease. During the 2020 Chapter 11 process, CEC said it would hold critical conversations with its landlords, so check whether a lease was amended during or after the bankruptcy. CEC said in June 2020 that its franchised locations operate under separate legal and financial structures (CEC release, June 24, 2020), so confirm whether CEC is a party to any franchised-location lease.
Confirm whether CEC Entertainment, LLC or a subsidiary is the tenant or guarantor on a company-operated lease; a CEC guarantee is only as strong as CEC’s own credit, which has had no S&P rating since S&P withdrew its below-investment-grade rating in October 2025, and it may have limited value in a restructuring. Responsibility for taxes, insurance, maintenance and structure varies, so confirm it in the lease. Investors evaluating a Chuck E. Cheese property should obtain the specific lease (and any post-2020 amendments) and verify: current rent schedule including any concessions that roll off, remaining base term, renewal option structure, percentage-rent provisions where applicable, whether the location is company-operated or franchised (materially different credit), and the specific lease vintage relative to the bankruptcy process.
Chuck E. Cheese NNN Cap Rates and Pricing
Live asking cap rates for Chuck E. Cheese and comparable tenants:
| Tenant | S&P / Moody’s | Median asking cap rate | Middle half of listings | Listings | Median vs. 10-year Treasury |
|---|---|---|---|---|---|
| Planet Fitness | n/a / n/a | 6.75% | 6.20% to 7.00% | 9 | +151 bps |
Active listings InvestmentGrade.com tracks with an asking cap rate (stated in the listing, or computed from its stated income and price when no rate is stated), listings last observed October 19, 2026. Asking cap rates are not closed-sale cap rates. The middle half is the range from the 25th to the 75th percentile of listings. The 10-year Treasury yield is 5.24% as of October 1, 2026 (FRED series DGS10). Ratings are the agency ratings in our ratings database for the entity shown, which may be a parent company; the rating type (for example issuer, senior unsecured debt, long-term debt or revenue bond ratings) varies by company and is shown on each tenant page. A rating applies to a lease only if the rated entity signs or guarantees it, so confirm the tenant and any guarantor in the lease. n/a means no verified rating is on file. Not shown because fewer than 3 active listings with a published cap rate were observed: Chuck E. Cheese, AMC Theatres.
We do not currently track enough Chuck E. Cheese listings with published asking cap rates to report a median. Pricing depends on whether the location is company-operated or franchised, the remaining lease term, the submarket and the quality of the real estate. S&P’s rating on CEC was below investment grade when it was withdrawn in October 2025 and there is no current S&P grade, so price each property on its own lease, credit support, location and real estate rather than on an assumed rating-based premium, and compare any offering with recent sales of Chuck E. Cheese and other family entertainment properties.
The buildings are specialized, with large open play areas, commercial kitchens and HVAC sized for high occupancy, so underwrite the cost of converting the space for another user and the land value of the site.
Chuck E. Cheese Real Estate Footprint & Remodel Program
CEC’s company-operated venues were in 44 states and Canada as of September 29, 2025, and the company is headquartered in Irving, Texas. In its fiscal 2019 Form 10-K, CEC said its venues are typically in densely populated areas, predominantly in shopping centers or in stand-alone buildings near them, and that Chuck E. Cheese venues average about 12,700 square feet. Possible backup uses include family fitness, trampoline parks, indoor recreation, specialty food service, or demising to multi-tenant configurations, but conversion cost and feasibility vary by site.
Chuck E. Cheese says it has spent more than $300 million remodeling its fun centers. Its animatronics are now preserved at only six legacy locations, it has expanded active play such as trampoline zones, and it launched a membership program; in September 2025 the company’s chief financial officer cited positive same-store sales momentum from the completed remodel program. For NNN landlords, tenant-paid remodel capital can improve the underlying property, a positive factor in the residual value analysis.
Chuck E. Cheese Forward Outlook
The forward outlook for Chuck E. Cheese depends on three factors: (1) continued same-store sales growth from the remodel program and membership subscription economics, (2) successful integration of the $625 million private credit term loan into the sustainable capital structure, and (3) any future change in ownership, such as a sale, public offering or recapitalization.
Key risks to the forward outlook from an NNN landlord perspective include: consumer discretionary spending weakness affecting family entertainment visits, competitive encroachment from alternative family entertainment formats (trampoline park chains, axe throwing, indoor adventure parks, premium movie theaters with family-oriented food service), and the risk of a future liability management or restructuring event for a company that filed for Chapter 11 in 2020 and whose S&P rating was below investment grade when S&P withdrew it in October 2025. Investors underwriting a Chuck E. Cheese property should model a scenario in which the lease is renegotiated or rejected in a future liability management event, particularly for franchised locations where the underlying franchisee credit may be materially weaker than CEC Entertainment itself.
Chuck E. Cheese NNN Investment: Pros & Cons
| Pros | Cons |
|---|---|
| Positive Operating Momentum: in September 2025 the company cited positive same-store sales momentum after completing its remodel program. | No Current S&P Rating: S&P withdrew its below-investment-grade issuer rating at the company’s request on October 23, 2025, which is not an upgrade, and we have not verified a current Moody’s rating; the September 2025 private credit term loan repaid the notes due May 2026. |
| Smaller Reported Company-Operated Footprint: company-operated venues fell from 555 at the end of 2019 to 501 at September 29, 2025. | Specialized Real Estate: purpose-built family entertainment format (about 12,700 SF average in fiscal 2019) can carry elevated alternative-use conversion costs, which vary by site. |
| Remodeled Improvement Basis: the company says it spent more than $300 million remodeling its fun centers, which can support the residual value analysis. | Franchisee Credit Variability: 156 franchised venues (September 29, 2025) may carry materially weaker underlying franchisee credit; verify operator identity and credit on each deal. |
| Ownership Change Risk: a future sale or recapitalization could introduce a new ownership structure and changed lease management approach. |
Comparable NNN Tenants
| Tenant | Rating | Sector |
|---|---|---|
| Dave & Buster’s | Not tracked | Entertainment and dining |
| Topgolf | Not tracked | Entertainment venue |
| Planet Fitness | no verified rating | Value fitness |
| AMC Theatres | B- | Movie exhibition |
| Chuck E. Cheese | No current S&P rating (withdrawn October 23, 2025); no current Moody’s rating verified | Family entertainment |
Ratings shown come from our ratings database, except Chuck E. Cheese, whose S&P rating was withdrawn on October 23, 2025 (see the source under the credit rating analysis). “Not rated” means our database holds no agency issuer rating for that tenant; it does not confirm that no agency rates it.
Frequently Asked Questions About Chuck E. Cheese NNN Investments
S&P Global Ratings withdrew its issuer credit rating on CEC Entertainment LLC on October 23, 2025, at the company’s request after its private refinancing; when withdrawn, the rating was below the BBB- investment-grade threshold and on CreditWatch with negative implications. A withdrawal is not an upgrade. The company filed for Chapter 11 in June 2020 and has since emerged as a privately held company, and it has cited positive same-store sales momentum since its remodel program.
We do not currently track enough Chuck E. Cheese listings to report a median asking cap rate. Pricing depends on whether the location is company-operated or franchised (and whose credit stands behind the lease), the remaining lease term and the submarket. Asking cap rates are not closed-sale cap rates, so compare offerings with recent sales.
CEC Entertainment closed a $625 million private credit term loan on September 26, 2025 and, with cash on hand, used it to fully redeem its outstanding $650 million Senior Secured Notes due May 2026. The term loan has a stated maturity of September 26, 2030. CEC also amended its revolving credit facility, reducing the commitment from $100 million to $75 million; the revolver matures August 9, 2029.
Chuck E. Cheese says it has spent more than $300 million remodeling its fun centers; it has also removed the animatronic band from all but six legacy locations, expanded active play such as trampoline zones, and launched a membership program. In September 2025, its chief financial officer cited positive same-store sales momentum from these initiatives. For NNN landlords, tenant-funded remodel capital can support the underlying property value in the residual analysis.
No. Of the 657 total venues as of September 29, 2025, 501 were company-operated (CEC Entertainment credit where CEC is the tenant or guarantor; S&P withdrew its rating on CEC in October 2025, so there is no current S&P grade) and 156 were franchised. Franchised locations operate under separate legal and financial structures from CEC (CEC release, June 24, 2020), so they carry the franchisee’s credit rather than CEC Entertainment’s unless CEC is a party to the lease, and franchisee credit may be materially weaker. NNN investors evaluating a Chuck E. Cheese property must verify whether the lease is to CEC Entertainment directly or to a franchisee operating entity, and adjust the underwriting accordingly.
It can be, but expect conversion costs. The purpose-built format may suit family fitness, trampoline parks, indoor adventure parks, specialty food service and entertainment combinations, urgent care and pediatric medical uses, or demising to multi-tenant family service retail; price the conversion for each site.
When the buyer owns the building, a cost segregation study may reclassify part of the purchase price, such as site improvements and some building systems and equipment, into 5-, 7- or 15-year property. That property can qualify for 100% bonus depreciation under Internal Revenue Code section 168(k) if acquired and placed in service after January 19, 2025 (IRS Notice 2026-11); used property qualifies only if the buyer did not use it before and acquires it in a qualifying purchase, for example not from a related party (section 168(k)(2)(E)(i) and section 179(d)). How much qualifies varies widely by property and must be supported by an engineering-based study. On a ground lease the investor owns only land, which cannot be depreciated, and equipment owned by the tenant is not the landlord’s to depreciate. Depreciation taken on that property is generally recaptured on a taxable sale (sections 1245 and 1250), and a 1031 exchange may not fully defer section 1245 recapture if the replacement property does not include enough section 1245 property (section 1245(b)(4)). Consult a tax professional. See the Depreciation by NNN Property Type.
Related: Gas Station Bonus Depreciation
Chuck E. Cheese Net Lease Property: Buying, Selling and Financing
Buying: We find on-market and off-market Chuck E. Cheese properties, review the lease and the tenant’s credit, and compare pricing with current listings. On the majority of transactions, there is no separate fee to you as the buyer; the listing broker pays a cooperating commission.
Selling: We can prepare an opinion of value from current listings and recent sales and, when it fits your goals, run a confidential sale to private investors, family offices and institutional buyers. See our guide to off-market sales.
Financing: Investment Grade Capital, a service of Investment Grade LLC, matches buyers and owners with lenders for acquisitions and refinancing.
1031 exchanges: Tell us your identification and closing deadlines so we can plan the search around them.
Request an NNN investment consultation or email team@investmentgrade.com.
Related NNN Tenants
Chuck E. Cheese NNN buyer routing: separate turnaround momentum from credit quality
Chuck E. Cheese has cited post-bankruptcy operating momentum, but S&P withdrew its below-investment-grade rating on CEC in October 2025 and the family-entertainment buildout is specialized, so underwrite the credit and the real estate separately. Before identifying a Chuck E. Cheese property in a 1031 exchange, compare it with the 2026 NNN cap-rate framework and the best investment-grade NNN tenants for 1031 buyers.
Buyer note: Weigh any cap-rate premium against CEC’s credit, whether CEC or a franchisee is the tenant or guarantor, and alternative-use cost. If a 1031 buyer wants low-friction passive income, compare Chuck E. Cheese against investment-grade QSR, grocery, pharmacy, and auto-service tenants before committing.
