How does Epcon Communities determine the Market Area for a franchisee's site?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
ed with materials and outside instructor costs. You are not required to attend additional training programs and refresher courses are not required.
ITEM 12. TERRITORY
Your project must be developed at a location within your "Market Area." Your Market Area is a geographic area estimated by us and you to generate sufficient purchaser support for the development of your project. Generally, a Market Area will roughly encompass the area within a radius of between 3 to 12 miles from your project site but will take into consideration existing natural and man-made boundaries and socioeconomic conditions in the area.
If you have identified your project location at the time that you sign the Franchise Agreement with us, you will also sign a Market Area Agreement with us. If you have not identified your project location, you will sign an Initial Market Area Agreement with us.
Initial Market Area Agreement
Except for existing projects or projects currently under development, when you sign the Initial Market Area Agreement you are granted an exclusive territory. ECFL and its affiliates will not construct, nor will ECFL license or franchise the rights to construct, a project using the Development System within the geographic area that makes up your Initial Market Area. Your exclusive rights in the Initial Market Area will end if: you are not in compliance with your Franchise Agreement or your Initial Market Area Agreement; it has been eighteen (18) months since you signed your Initial Market Area Agreement; you sign a Market Area Agreement; or you allege that you have rights in our copyrighted works. When your exclusive rights in the Initial Market Area end, ECFL and its affiliates may construct, and ECFL may license or franchise the rights to construct, a project using the Development System in your Initial Market Area.
You will have eighteen (18) months from the date of the Initial Market Area Agreement to identify the location of your project and enter into a Market Area Agreement with us. If not, your Initial Market Area Agreement and Franchise Agreement will automatically terminate. In circumstances where you have not identified a specific site for your project, we may, but are not obligated to, agree to extend the time period in which you are required to locate suitable property for your project. When you identify a site for your project, and we agree to that location, you will be required to sign the Market Area Agreement with us. You may not relocate your initial market area without our consent, which may be withheld or conditioned in our sole discretion.
Market Area Agreement
The Market Area for your site will be determined by us and will be depicted on a map attached as an exhibit to the Market Area Agreement. Your Market Area Agreement will also include the location of your project, which must be approved by us.
Once you sign your Market Area Agreement, as long as you are in compliance with its terms and those of the Franchise Agreement, the Market Area is exclusive to you and ECFL agrees not to grant to another franchisee or licensee the right to develop an Epcon Communities project within your Market Area, and agrees that ECFL and its affiliates, will not develop an Epcon Communities project within your Market Area.
Source: Item 12 — TERRITORY (FDD pages 48–50)
What This Means (2025 FDD)
According to Epcon Communities' 2025 Franchise Disclosure Document, the Market Area for a franchisee's site is determined collaboratively by Epcon Communities and the franchisee. This area is estimated to generate sufficient purchaser support for the development of the franchisee's project. The determined Market Area will be depicted on a map attached as an exhibit to the Market Area Agreement, which also includes the approved location of the project. Generally, the Market Area will roughly encompass the area within a radius of between 3 to 12 miles from the project site, but will take into consideration existing natural and man-made boundaries and socioeconomic conditions in the area.
Once the Market Area Agreement is signed, the franchisee gains exclusive rights to that Market Area, provided they remain in compliance with both the Market Area Agreement and the Franchise Agreement. This exclusivity means that Epcon Communities will not grant another franchisee or licensee the right to develop an Epcon Communities project within the franchisee's Market Area, nor will Epcon Communities or its affiliates develop a project there. This exclusivity is a significant benefit, as it protects the franchisee's investment and market share from direct competition from within the Epcon Communities system.
However, these exclusive rights are not indefinite. The exclusivity terminates automatically if the franchisee is not in compliance with the Franchise Agreement or Market Area Agreement, upon completion of all buildings in the project, if the rights to use the Development System are terminated, or if the franchisee alleges rights in Epcon Communities' copyrighted works. Once the exclusive rights end, Epcon Communities and its affiliates regain the right to construct, license, or franchise the rights to construct a project using the Development System within the former Market Area. The franchisee is also prohibited from using the Development System at locations not specified in their currently effective Market Area Agreement.
If a franchisee wishes to develop additional Epcon Communities projects, either within their existing Market Area or in a new area, they must sign a new Franchise Agreement and Market Area Agreement and pay the applicable fees. The terms of the new Franchise Agreement may differ materially from the original. Furthermore, franchisees have the option to obtain a "hold" on an additional Market Area by signing a Market Hold Agreement and paying a nonrefundable Market Hold Fee of $5,000 for a 12-month hold period, which can be applied toward the Initial Franchise Fee if a Franchise Agreement is signed for that area before the hold expires.