What was the total operating lease expense for Buildingstars in 2023?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
| Year Ending | |
|---|---|
| December 31, | |
| 2025 | $ 89,928 |
| 2026 | 89,928 |
| 2027 | 89,928 |
| 2028 | 89,928 |
| 2029 | 85,414 |
| Thereafter | 157,119 $ 602,245 |
NOTE 4 — LEASES
The Company leases certain office space and equipment from third parties and a related party. The Company leases vehicles under finance leases.
The components of lease costs are as follows:
| | Year Ended December 31, | |
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 34–43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the total operating lease expense for the year 2023 was $185,279, while the related party lease expense was $257,551. Additionally, the short-term lease expense amounted to $267,705 for the same year. These figures provide insight into the leasing obligations and expenses that Buildingstars incurred during that period.
For a prospective Buildingstars franchisee, understanding these lease expenses is crucial as it reflects the financial obligations Buildingstars undertakes to operate its business. The operating lease expense of $185,279 represents the cost of leasing properties or equipment necessary for the company's operations. The related party lease expense of $257,551 indicates transactions with entities connected to Buildingstars, which could have implications for the company's financial structure and transparency. The short-term lease expense of $267,705 shows the costs associated with leases having a term of 12 months or less.
It is important to note that these expenses can impact Buildingstars's profitability and financial stability. Franchisees should consider these figures when evaluating the overall financial health of the company and its ability to support its franchisees. Furthermore, understanding the nature of related party transactions is essential for assessing potential conflicts of interest and ensuring fair dealings. Prospective franchisees should inquire about the terms and conditions of these leases to gain a comprehensive understanding of Buildingstars's financial commitments and obligations.