What does the low estimate for lease security deposit and rent for Aw assume?

According to Aw's 2025 Franchise Disclosure Document, the low estimate for the lease security deposit and rent, which ranges from $4,000 to $16,000 for the first three months, assumes that the franchisee will be able to negotiate some free rent at the beginning of the lease. The document also notes that the security deposit is typically one month's rent. The rent amount can fluctuate based on the size, type, condition, and location of the premises, which should range from 900 to 2,500 square feet.

For a prospective Aw franchisee, this means that the initial investment for the restaurant location could be lower if they can successfully negotiate a period of free rent with the landlord. This could significantly reduce the upfront costs associated with starting the business, as the lease security deposit and rent are a substantial part of the initial investment, as shown in the table.

However, it's important to note that securing free rent is not guaranteed and depends on various factors, including the landlord's willingness to negotiate and the prevailing market conditions. If a franchisee is unable to negotiate free rent, their initial investment could be closer to the higher end of the estimated range. The FDD specifically advises against purchasing a site, so the estimate focuses on leasing.

Franchisees should carefully consider their ability to negotiate favorable lease terms and factor this into their financial planning. It would be prudent to research typical lease arrangements in their target location and consult with a real estate professional experienced in commercial leasing to assess the likelihood of obtaining free rent and to understand the typical security deposit and rent structures in that area.