What amount of lease payments does Christian Brothers Automotive project to receive 'Thereafter'?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
n. Tenant will take possession of the Premises within five days of receiving notice that the Premises are Substantially Completed (as such term is defined in the Master Lease).
5. Payment of Rent.
- a. Tenant will pay Lessor the following amounts during the following periods: (a) $22,000- $36,000 per month for the first one year period of this Lease (the exact amount will be as Lessor notifies Tenant in the Lease Term Letter) commencing on the Commencement Date (subject to the provisions of subsection (e), below) and on the first day of each calendar month thereafter; and (b) on each one year anniversary of this Lease, the rent for the next one year period of this Lease will be established by increasing the amount of the rent that was paid for the previous one year period by one and one-half percent. For example, at the end of the first year of the Lease, the rent paid for the initial one year period will be multiplied by one hundred and one and one-half percent and the product will become the rent for the next one year period (x multiplied by 101.5% = y; where x = rent for previous one year period and y = rent for subsequent one year period); at the end of the second one year period, the rent for that period will be multiplied by one hundred and one and one-half percent and the product will become the rent for the third one year period. This process will be continued at the end of each one year period of the Lease (including all renewals and extensions) to establish the rent for the next one year period.
- b.
Source: Item 23 — RECEIPTS (FDD pages 76–372)
What This Means (2025 FDD)
According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, the lease payments a tenant will pay to the lessor are structured as follows: For the first year of the lease, the tenant will pay between $22,000 and $36,000 per month. The exact amount will be specified by the lessor in the Lease Term Letter. These payments commence on the Commencement Date.
After the initial one-year period, the rent for each subsequent one-year period will be determined by increasing the rent paid during the previous year by 1.5%. This means that at the end of the first year, the rent paid for that year will be multiplied by 101.5% to establish the rent for the second year. For example, if the rent for the first year was 'x', the rent for the second year would be 'x' multiplied by 101.5%, resulting in 'y'.
This process of increasing the rent by 1.5% annually will continue at the end of each one-year period throughout the lease term, including any renewals or extensions. The rent is payable in advance and without demand at the lessor's offices, located at 17725 Katy Freeway, Houston, Texas 77094, on or before the 1st day of each month, commencing on the Commencement Date, without any grace period.