What factors can cause leasehold improvement costs to be higher for a Fat Shack restaurant?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
The high estimates in the above chart reflect the build-out of a 2,500 square foot space. Your costs to improve the Restaurant Location will also depend in large part on whether your space is completely constructed or is the remodel of an existing space. The leasehold improvements that you will typically make include interior remodeling, floor covering, painting, wall covering, HVAC, Type I hood, electrical, plumbing, design, millwork, and various other improvements. These costs may vary significantly from market to market. You will be responsible for these costs. Leasehold Improvements may be higher if you elect to have special customization build out of your space.
Source: Item 7 — Estimated Initial Investment (FDD pages 18–22)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, several factors can influence the cost of leasehold improvements. The size of the space is a primary driver; building out a larger 2,500 square foot space will naturally be more expensive than a smaller one. The condition of the space also plays a significant role. If the location requires extensive remodeling rather than being a completely new construction, costs can escalate.
Specific improvements like interior remodeling, flooring, painting, wall coverings, HVAC systems, Type I hoods, electrical work, plumbing, design, and millwork all contribute to the overall expense. These costs are also subject to market variations, meaning that prices for labor and materials can differ significantly from one location to another. Therefore, franchisees need to research local market conditions to accurately estimate these expenses.
Furthermore, the level of customization chosen by the franchisee can substantially impact leasehold improvement costs. Electing to have special, custom build-outs will inevitably lead to higher expenses compared to standard designs. Given these variables, it's crucial for prospective Fat Shack franchisees to carefully consider the size and condition of their chosen location, local market prices, and their desired level of customization to develop a realistic budget for leasehold improvements. The FDD estimates these costs can range from $50,000 to $200,000.