Does the Beard Papas Franchise Agreement include any provisions for rent escalation during the lease term?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
Landlord agrees that any assignment of the Lease and Tenant's leasehold interests in the Lease by Tenant to Franchisor and/or assumption by Franchisor of the Lease and such leasehold interests shall not require Landlord consent and shall not require any payment of any assignment fee or similar charge or result in any increase in rent or other fees as a result of such assignment and/or assumption.
Source: Item 23 — RECEIPTS (FDD pages 58–275)
What This Means (2025 FDD)
According to the 2025 Beard Papas Franchise Disclosure Document, the Rider to the lease agreement states that in the event that Beard Papas assumes the lease from the franchisee, the landlord cannot increase rent or other fees as a result of the assumption or assignment of the lease.
However, the document does not explicitly state whether the standard lease agreement between the franchisee and landlord includes rent escalation clauses. The FDD indicates that the franchisee is responsible for site selection and lease negotiation, subject to Beard Papas' approval of the site and lease terms. This suggests that rent escalation clauses could potentially be part of the lease agreement, depending on what the franchisee negotiates with the landlord.
Therefore, a prospective Beard Papas franchisee should carefully review the lease agreement for any potential rent escalation clauses and negotiate terms that are favorable to their business. It would be prudent to seek legal counsel to review the lease and ensure a full understanding of all obligations and potential costs over the lease term.