Under what condition is the Christian Brothers Automotive tenant entitled to an abatement of rent?
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. Rent is payable in advance and without demand at Lessor's offices located at
Source: Item 23 — RECEIPTS (FDD pages 76–372)
What This Means (2025 FDD)
Based on the 2025 Christian Brothers Automotive Franchise Disclosure Document, the excerpts provided do not specify any conditions under which the tenant is entitled to an abatement of rent. The document outlines the payment of rent, including the amounts due per month and how the rent increases annually. However, it does not mention any circumstances that would lead to a reduction or abatement of rent.
While the excerpts detail aspects of rent payment and increases, they do not address potential scenarios where rent abatement might be applicable, such as during periods of property damage, repairs, or other unforeseen circumstances that could disrupt the franchisee's business operations. The lease agreement referenced in the FDD may contain such clauses, but they are not included in the provided excerpts.
A prospective Christian Brothers Automotive franchisee should inquire with the franchisor about the specific conditions, if any, under which rent abatement may be granted. This information is crucial for understanding the financial obligations and potential relief measures available during the lease term. It would be prudent to review the full lease agreement carefully and seek legal counsel to fully understand the terms and conditions related to rent and potential abatements.