What is the initial term length for Bath Tune Up's operating leases?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
fice and storage building located in Aberdeen, South Dakota. The Company leases real estate under noncancellable operating lease agreements that expire at various dates through 2027. See Note 2 for a summary of the Company's policies relating to leases. The initial terms of operating leases are five years and certain leases provide for free rent periods, periodic rent increases, and renewal options. Monthly payments for these leases range from $700 to $4,774.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 51–52)
What This Means (2025 FDD)
According to Bath Tune Up's 2025 Franchise Disclosure Document, the initial terms of their operating leases are five years. These leases may include free rent periods, periodic rent increases, and renewal options. The monthly payments for these leases range from $700 to $4,774.
These leases generally require Bath Tune Up to cover the costs of maintenance, repairs, property taxes, and insurance, which are variable amounts based on actual costs incurred during each period. The total rent expense to the Company was $352,978 for 2022.
Prospective Bath Tune Up franchisees should consider these lease terms and associated costs when evaluating the financial feasibility of the franchise. Understanding the specific terms of the lease, including potential rent increases and responsibilities for maintenance and repairs, is crucial for accurate financial planning. The initial five-year term provides a stable period, but franchisees should also assess the renewal options and potential changes in lease terms at the end of the initial period.