What is the estimated range for base monthly rent for a Big O Tires store?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
If you do not own adequate space, you will need to lease or purchase the land and building for your Store. Typically locations for a Store are prime retail sites. You will generally need a facility of 5,000 to 8,000 square feet to operate your store with a prototypical store sized at 6,240 square feet. If leased, the base monthly rent is estimated to range from $10,000 to $40,000 per month, depending on geographic location, size of the premises and other economic factors. Typically, these leases are triple net leases, under which the tenant must pay all taxes, insurance and maintenance expenses over and above the base rent amount. The estimate provided assumes that you will rent the facility and that you must provide a security deposit of one month's base rent to the landlord. In a buildto-suit lease, the landlord may include some or all of the improvements, fixtures, and signs in the cost to build the building and factor these costs into your lease payments. You may elect to purchase the land and building rather than renting. If you purchase the land and build your store, your estimated combined costs for the land and building construction may range from $1,200,000 to $4,500,000 depending upon market conditions.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT (FDD pages 35–39)
What This Means (2025 FDD)
According to Big O Tires's 2025 Franchise Disclosure Document, the estimated base monthly rent for a store ranges from $10,000 to $40,000. The FDD notes that this range depends on factors such as geographic location, the size of the premises, and other economic conditions. The typical store size is between 5,000 to 8,000 square feet, with a prototypical store sized at 6,240 square feet.
It is important to note that Big O Tires typically operates under triple net leases. This means that in addition to the base rent, the franchisee is responsible for paying all property taxes, insurance, and maintenance expenses associated with the property. The estimate also assumes that the franchisee will provide a security deposit to the landlord, typically equal to one month's base rent.
For franchisees considering purchasing land and building instead of leasing, the estimated combined costs for land and building construction range from $1,200,000 to $4,500,000, depending on market conditions. The FDD also specifies that if a franchisee is looking at a "high" cost real estate project, they must have a net worth of $500,000 or more, and liquid assets of $150,000 or more. High cost real estate is defined as purchased real estate costing $4,500,000 or more, or leased real estate with payments of $40,000 per month or more.
Prospective franchisees should carefully consider these real estate costs and consult with a business advisor to determine the best option for their individual circumstances. Understanding the full scope of lease obligations, including base rent, additional expenses, and security deposits, is crucial for accurate financial planning.