What factor significantly influences whether an Itan franchisee will receive a Tenant Improvement (TI) Allowance from a landlord, and if so, the amount?

According to Itan's 2025 Franchise Disclosure Document, a significant factor in determining whether a landlord will provide a Tenant Improvement (TI) Allowance, and the amount of that allowance, is whether the building space is first generation or second generation. First-generation space typically requires more extensive build-out and improvements compared to second-generation space, which may have existing infrastructure from a previous tenant. The FDD notes that the estimated initial investment in Item 7 assumes that the franchisee does not receive any TI Allowance from the landlord.

Construction costs for an Itan franchise can range from $150,000 to $250,000, as shown in the table outlining the estimated initial investment. These costs are influenced by the size and condition of the leased space, whether it is first or second-generation retail space, the extent of existing leasehold improvements, and demolition and construction costs in the local market. The availability of a TI Allowance can significantly offset these construction expenses, making the difference between first and second-generation spaces a crucial consideration for prospective franchisees.

Prospective Itan franchisees should carefully evaluate potential locations and negotiate with landlords to secure a TI Allowance, especially if considering a first-generation space. Understanding the potential construction costs and the likelihood of receiving a TI Allowance is essential for accurately estimating the initial investment and managing the financial risks associated with opening an Itan franchise. The document recommends consulting with professionals to develop a budget for the construction, opening, and operation of the Salon.