What is the role of the landlord in the Site Selection Assistance for a Fitstop franchise?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
information.
-
- Site Selection Assistance. The low end of this estimated range assumes that the third-party provider you engage to assist in your review and analysis of potential sites for your Franchised Business for you to consider will provide such services and ultimately be compensated by the landlord of the site that you submit and we approve as the Premises of your Franchised Business which seems to be the common practice amongst many national real estate brokers such as CBRE®. The high end of this estimate assumes that "Site Selection" costs will include some type of payment to your site selection assistance provider, while also accounting for some additional out-of-pocket costs you might incur on preliminary buildout analysis or other information you submit as part of your site proposal package.
-
- Lease: Security Deposit and other Pre-Opening Payments. These are estimated amounts of your security deposit under the lease for the Premises, which our standard franchise offering expects will be between 1,800 to up to 3,000 square feet.
Source: Item 7 — TEM 7: ESTIMATED INITIAL INVESTMENT (FDD pages 15–19)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, the landlord may play a role in covering the costs of site selection assistance. The FDD indicates that it is common practice for the third-party provider assisting in the review and analysis of potential sites to be compensated by the landlord if Fitstop approves the site as the franchise's premises.
However, the franchisee may incur site selection costs ranging from $0 to $10,000. This amount accounts for situations where the franchisee might need to pay the site selection assistance provider directly or cover out-of-pocket expenses for preliminary buildout analysis or other information submitted as part of the site proposal.
Additionally, the franchisee is responsible for negotiating lease terms with the landlord, including rent and any free rent periods. The security deposit, estimated between $8,000 and $75,000, is also arranged between the franchisee and the landlord. The landlord may also agree to provide a tenant improvement credit, which would offset some of the build-out costs against the monthly rent.