What was the weighted-average remaining lease term for finance leases for Checkersrallys as of December 30, 2024?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
| January 1, 2024 (Successor) | January 2, 2023 (Predecessor) | |
|---|---|---|
| Weighted-average remaining lease term-finance leases | 22.6 years | 22.4 years |
| Weighted-average remaining lease term-operating leases | 19.1 years | 19.5 years |
| Weighted-average discount rate—finance leases | 4.15% | 2.99% |
| Weighted-average discount rate-operating leases | 3.94% | 2.07% |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the weighted-average remaining lease term for finance leases as of December 30, 2024, was 22.6 years. This figure reflects the average length of time remaining on all of Checkersrallys's finance leases, weighted by the size or value of each lease.
For a prospective franchisee, this indicates the long-term nature of Checkersrallys's financial commitments related to leased properties. Finance leases are typically used for long-term assets where Checkersrallys essentially assumes the risks and rewards of ownership. The length of these leases suggests that Checkersrallys invests in locations with a long-term strategic outlook.
It's also worth noting that the weighted-average remaining lease term for finance leases was 22.4 years as of January 2, 2023. The slight increase to 22.6 years by December 30, 2024, could be due to new leases being entered into or existing leases being extended. Franchisees should consider how these long-term lease obligations might affect Checkersrallys's financial flexibility and stability, as these obligations could impact the franchisor's ability to support its franchisees during economic downturns or unexpected challenges.
Understanding the details of these finance leases, such as the specific properties involved and the terms of renewal, would be a prudent step for anyone considering investing in a Checkersrallys franchise. This information can provide a clearer picture of the company's financial health and its long-term strategy.