What was the total property lease expense for Budget in 2023?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
erms. We believe that, based on current market conditions, the net proceeds from the sale of these vehicles at the end of their lease terms will equal or exceed their net book values and therefore have not recorded a liability related to guaranteed residual values.
The components of lease expense are as follows:
| The components of lease expense are as follows: | Year E | Ended December 31, |
|---|
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the total property lease expense for the year ending December 31, 2023, was $1,256. This figure is comprised of several components, including operating lease expenses of $860, variable lease expenses of $402, and a deduction for sublease income of $6.
For a prospective Budget franchisee, understanding the components of lease expenses is crucial, as these costs can significantly impact profitability. Operating lease expenses typically cover the base rent for the property, while variable lease expenses may include costs tied to revenue, such as concession fees at airport locations. Sublease income, if applicable, can offset some of these expenses.
It's important to note that these figures represent Budget's overall property lease expenses and may not directly reflect the specific lease costs a franchisee will incur. Franchisees should carefully review their individual lease agreements and consider factors such as location, size, and terms when projecting their own expenses. Additionally, franchisees should inquire about any potential changes in lease expenses or concession agreements that could affect their financial performance.