What must happen if the Approved Location for the Engel & Volkers franchise is not determined by the date of the agreement?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 1.4 The Franchisee: Franchisee wishes to be franchised the right to use the ENGEL & VÖLKERS System to operate a residential real estate brokerage and franchised business under this Agreement (the franchised "Business") at and only at the approved location specified in Appendix 1 (hereinafter called the "Approved Location"). If, as of the date of this Agreement, the Approved Location has not yet been determined, then it shall thereafter be determined in accordance with Section 3.1 and, upon determination, inserted into Appendix 1. Franchisor is prepared to grant Franchisee, at its request, a franchise to use the ENGEL & VÖLKERS System to operate a residential real estate brokerage at the Approved Location and to use commercially reasonable efforts to support Franchisee.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, if the Approved Location for the franchise has not been determined by the date of the Franchise Agreement, it will be determined later according to Section 3.1 of the agreement. Once the location is determined, it will then be added to Appendix 1 of the Franchise Agreement.
This means that a prospective Engel & Volkers franchisee may sign the agreement before a specific location has been finalized. However, the franchisee is still obligated to find and secure an approved location. Failure to do so in a timely manner and secure Engel & Volkers's approval, as per Section 3.1, can be grounds for termination of the agreement, as stated in Section 20.3.1.
This arrangement provides some flexibility for the franchisee in securing a location after signing, but it also places the onus on them to find a suitable site that meets Engel & Volkers's approval. It's important for prospective franchisees to understand the criteria Engel & Volkers uses for location approval and the timeline for securing a location to avoid potential default on the agreement.