How does the presence of an existing kitchen in a location affect the leasehold improvement costs for a Bambu franchise?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 2: Leasehold Improvements. Your cost to build-out a location for a Bambū shoppe will vary greatly. The square footage of the location, the as-is condition, tenant improvement allowances from the landlord, and the type and availability of utilities and services are typically the largest monetary items affecting your shoppe buildout. A second-generation restaurant or QSR location with an existing kitchen and plumbing will significantly reduce these costs depending on final layout. Bambū shoppes are divided into two distinct areas, the kitchen area and the front of the house, also called the customer service and seating area. The kitchen area, bathrooms and the storage and maintenance area, which in total typically requires approximately 400-500 sq. ft. of space, is the most expensive to build out. The front of the house can be almost any size but having 500-600 sq. ft. for seating and front counter is typically sufficient. In the situation where there is an existing kitchen there is usually no tenant improvement allowance from the landlord. In space that is commonly called Vanilla Shell or Gray Shell, the cost of to build out the space is much greater because the space is basically four walls with utilities stubbed in. However, landlords often will provide a tenant improvement allowance or rent abatement as part of the lease to cover some or all of the cost of build-out.
The costs shown in the chart are estimated costs to build out space in an in-line leased location of approximately 1,100 sq. ft. The lower estimate in the chart assumes you have obtained built-to-suit lease space, or it is "move-in-ready" space. But each situation is unique and needs to be reviewed and negotiated with the landlord. The most important factors, however, are finding the best locations and then what type of spaces are available once those locations are identified.
Source: Item 7 — (FDD pages 18–22)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the presence of an existing kitchen and plumbing in a second-generation restaurant or QSR location can significantly reduce leasehold improvement costs. These costs are highly variable, with the square footage, condition of the location, tenant improvement allowances, and availability of utilities being major factors. The FDD estimates that leasehold improvements can range from $35,000 to $145,000.
The document specifies that Bambu shoppes are divided into a kitchen area (400-500 sq. ft.) and a front-of-house area (500-600 sq. ft.). The kitchen area is the most expensive to build out. If a location already has a kitchen, the landlord is less likely to offer a tenant improvement allowance. Conversely, a "Vanilla Shell" or "Gray Shell" space, which is essentially four walls with utilities stubbed in, will have higher build-out costs, but landlords may offer allowances or rent abatement to offset these expenses.
The lower end of the estimated leasehold improvement costs ($35,000) assumes a "move-in-ready" space or a built-to-suit lease. The higher end ($145,000) is for a full build-out of an 1,100 sq. ft. location with a modest tenant improvement allowance. The FDD advises prospective franchisees to carefully review and negotiate lease terms with the landlord, emphasizing that finding the best location and understanding the available space types are crucial factors.