What is the expected rent/lease obligation for a Chesters Restaurant-in-Store franchise?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
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- All Restaurant-in-Store franchises will be located within your existing space, so you should have no significant additional rent/lease obligations unless you pay percentage rent. For a CHESTER'S Restaurant at a food court, a strip mall, or other non-traditional locations (such as a sports arena or stadium), we assume that you will lease the building or space for the Restaurant. However, if you currently own the building in which the Restaurant will be located, you should incur no rental costs. While we anticipate that the average in-line/food court Restaurant size will be 1,200 square feet, your Restaurant's size will depend on the location you choose. If you lease space from a third-party landlord, your monthly rent will depend on the location, the demand for the location among prospective lessees, general rental rates in that geographic area, whether the landlord adds tenant build-out allowances into the rent, and similar factors. You might have to pay base rent and percentage rent based on Restaurant gross sales. If utilities, taxes, and insurance are included in rent, then the rent also might increase. You also should expect to pay a security deposit equal to 1 or 2 months' rent.
- 3 If you operate a Restaurant-in-Store in a convenience store, this figure assumes the Restaurant will have 500 square feet. If you operate a CHESTER'S Restaurant at a food court or
strip-mall location, this figure assumes the Restaurant will have 1,200 square feet.
Source: Item 7 — **ESTIMATED INITIAL INVESTMENT (FDD pages 16–19)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the rent and security deposit costs for a Restaurant-in-Store franchise are variable. For a Restaurant-in-Store franchise located within an existing space, there may be no significant additional rent/lease obligations unless the franchisee pays percentage rent. However, for a Chesters Restaurant at a food court, strip mall, or other non-traditional locations, Chesters assumes that the franchisee will lease the building or space for the Restaurant.
The monthly rent depends on factors such as the location, demand for the location, general rental rates, and whether the landlord includes tenant build-out allowances in the rent. The franchisee might have to pay base rent and percentage rent based on the Restaurant's gross sales. The rent might also increase if utilities, taxes, and insurance are included. Additionally, the franchisee should expect to pay a security deposit equal to 1 or 2 months' rent.
The FDD also includes a table outlining the estimated initial investment, which includes a line item for "Rent and Security Deposit." The amount is listed as "See Note 2", indicating that the cost can vary. The payment method is "As arranged" and the payment is due "As incurred" to the "Owner/Lessor."
Given the variability, prospective Chesters franchisees should carefully evaluate potential locations and negotiate lease terms to understand their potential rent and security deposit obligations. Consulting with a business advisor is recommended to review these figures and understand the financial implications before acquiring the franchise.