In some cases we advise holding assets in trust to reduce the franchise taxes some States charge. 

Franchised property bought from a couple that was retiring, the business was an owner-run property.

@Mary Blanco, this article identifies a strategy I have seen used successfully in California to avoid the franchise fees and regulations that were spelled out earlier for investors in California. 

@Simon Ruiz, a good strategy in California is to use the Delaware Statutory Trust that has similar protections to LLC's and avoid the franchise fees of California.

Will the cost for setting up and maintaining the DST and the operating LLC cost less than the $800 CA Franchise tax, initially and ongoing?

@Kara CourtneyYou should consult with your attorney and CPA about which legal and tax structure is best for you.Don't forget that the $800 CA franchise tax applies to each LLC you're a managing-member of...

The business lawyer was really good and to this day I refer people to him and every now and then he gives me leads (he just gave me one last week in fact for a large restaurant franchise that the owners also own the r/e).  

On the other hand, keep in mind that there are costs associated with maintaining an LLC (such as the $800 annual franchise tax in California).2.

BUT California will exercise a hefty franchise tax on each child series you create--$800 per child series as you noted above. 

@Ross Denman what is the national franchise that you are a part of?