Can an Engel & Volkers franchisee transfer the right to operate a Limited Purpose Administrative Location?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS | LIMITED PURPOSE ADMINSTRATIVE LOCATION ADDENDUM ("Administrative Location Addendum") is made and entered into this (the "Effective Date") by and between ENGEL & VÖLKERS AMERICAS, INC., a Delaware corporation ("Franchisor"), and, a ("Franchisee"). |
|---|---|
| as set forth in the FA. | WHEREAS, Franchisor and Franchisee entered into a Franchise Agreement, dated (the |
| "FA") providing Franchisee with the right to use the ENGEL & VÖLKERS System to operate an Engel & | |
| Völkers Residential Real Estate Brokerage and conduct the franchised Business at an Approved Location | |
| WHEREAS, Franchisee has requested to operate an additional location within Franchisee's | |
| Protected Area for the limited purpose of housing Franchisee's administrative and support personnel and | |
| related administrative tasks for Franchisee's franchised Business. | |
| FA. | NOW THEREFORE, in consideration of the provisions in the FA, the promises in this |
| Administrative Location Addendum, and other good and valuable consideration, the delivery, receipt, and | |
| sufficiency of which are acknowledged, the parties mutually agree as set forth below. All capitalized terms | |
| not defined in this Administrative Location Addendum shall have the respective meanings set forth in the | |
| 1. | Grant of Limited Purpose Administrative Location: |
| 1.1 | Franchisor hereby grants Franchisee the non-exclusive, non-transferrable right to |
| establish and operate a Limited Purpose Administrative Location at, and only at the | |
| following | |
| location: | |
| (the | |
| "Administrative | |
| Location") within Franchisee's Protected Area subject to the terms of this Administrative | |
| Location Addendum and the FA. | |
| 1.2 | Franchisee acknowledges and agrees that the Administrative Location is not deemed to |
| be nor does it constitute, replace or otherwise amend Franchisee's obligation to establish | |
| and operate an Approved Location as set forth in the FA. | |
| 1.3 | Franchisee may not relocate the Administrative Location without Franchisors prior |
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the right to operate a Limited Purpose Administrative Location is explicitly non-transferrable. The Administrative Location Addendum specifies that Engel & Volkers grants the franchisee a "non-exclusive, non-transferrable right" to establish and operate this type of location. This means a franchisee cannot sell, assign, or otherwise transfer the rights to this specific administrative location to another party.
This restriction is significant for potential Engel & Volkers franchisees because it limits their flexibility in exiting the business or restructuring their operations. Unlike a standard franchise location, the administrative location cannot be sold as an asset. This could affect the overall valuation of the franchise if a franchisee decides to sell their entire business, as the administrative location's value is tied directly to the original franchisee's operation.
Engel & Volkers' decision to prohibit the transfer of administrative locations likely stems from a desire to maintain control over these supplementary sites and ensure they continue to serve their intended purpose: housing administrative and support personnel without engaging in direct client services or real estate transactions. This helps Engel & Volkers maintain brand consistency and prevent unauthorized expansion or misuse of these locations. The franchisee also may not relocate the Administrative Location without Engel & Volkers' prior written consent.