What was the total rent expense for Carbones Pizzeria for the year ended October 31, 2023?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
ut of the ordinary course of business. The Company does not believe that these legal actions will have a material adverse effect on the Company's financial position, results of operations or cash flows.
Operating Lease
The Company has a month-to-month operating lease with a related party. Rental payments are $8,000 a month. The lease also provid
Source: Item 22 — CONTRACTS (FDD page 30)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, the company's total rent expense for the year ending October 31, 2023, was approximately $82,000. This expense relates to a facility leased from a limited liability company owned by the stockholder of Carbones Pizzeria. The lease agreement is on a month-to-month basis with rental payments of $8,000 per month.
In addition to the base rent, the lease terms require Carbones Pizzeria to cover property taxes, maintenance, insurance, and other occupancy expenses for the leased premises. This means that the franchisee's actual costs for the facility could fluctuate based on these additional expenses, which are not fixed and can vary over time.
Prospective franchisees should consider that related-party transactions, such as this lease agreement, can present both benefits and risks. While it may offer flexibility, it's crucial to assess whether the terms are competitive compared to market rates and to understand the potential for conflicts of interest. It is important to review the complete financial statements and lease agreement to fully understand all associated costs and obligations.