What do the common area maintenance charges cover for a Jack In The Box franchise?
Jack_In_The_Box Franchise · 2025 FDDAnswer from 2025 FDD Document
| Common Area | Actual costs charged by | Varies, but | If you lease a restaurant | | Maintenance | master landlord or any | common area | location from us or our | | charges, | third party under the | maintenance | affiliates, in addition to | | Type of Fee | Amount | Due Date | Remarks | |---------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | property taxes, and other assessments | prime lease or other governing documents | charges and other assessments are typically due with minimum rent in advance on the first day of each month and property taxes are typically due monthly or semi annually | any rent obligations, you may also be responsible for the location's Common Area Maintenance charges, property taxes, and other similar assessments. Whether you will be responsible for such charges and the amount of such charges will be determined based upon the lease negotiated for the restaurant. |
Source: Item 6 — OTHER FEES (FDD pages 27–35)
What This Means (2025 FDD)
According to Jack In The Box's 2025 Franchise Disclosure Document, franchisees leasing a restaurant location from Jack In The Box or its affiliates may be responsible for Common Area Maintenance (CAM) charges, property taxes, and other similar assessments. The specific charges and amounts will depend on the lease negotiated for the restaurant location. These charges are in addition to any rent obligations. CAM charges and other assessments are typically due with minimum rent in advance on the first day of each month, while property taxes are typically due monthly or semi-annually.
In practical terms, this means a Jack In The Box franchisee's monthly expenses could fluctuate based on these additional charges. The FDD indicates that the actual costs are charged by the master landlord or any third party under the prime lease or other governing documents. This implies that Jack In The Box franchisees do not have direct control over the amounts of these charges, as they are determined by external entities.
Prospective franchisees should carefully review the lease agreement for their specific location to understand the full scope of their responsibilities regarding CAM charges, property taxes, and other assessments. It is important to factor these potential costs into their financial projections to ensure the profitability of their Jack In The Box franchise. Understanding these costs upfront can help avoid unexpected financial burdens and ensure a more predictable operating budget.
It is common in the franchise industry for franchisees to bear responsibility for CAM charges, especially in locations where the franchisor leases the property and subleases it to the franchisee. This arrangement allows the franchisor to manage the overall property while passing on the location-specific costs to the franchisee. However, the specifics can vary widely, making it crucial for franchisees to carefully examine their lease agreements.