What is included in the variable lease costs for Moes Southwest Grill?
Moes_Southwest_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
Total operating lease costs include rental expense related to leases for Company SBRs recorded to Company store, bakery and restaurant operations expenses, leased properties that are subsequently subleased to franchisees recorded to Franchise and other rental expense, and leases for corporate offices recorded to Selling, general and administrative expenses. Variable lease costs are primarily comprised of common area maintenance, real estate taxes, and contingent rent that is based upon a percentage of SBR sales.
Source: Item 23 — Receipts (FDD pages 92–334)
What This Means (2025 FDD)
According to Moes Southwest Grill's 2025 Franchise Disclosure Document, variable lease costs primarily consist of common area maintenance, real estate taxes, and contingent rent. The contingent rent is based upon a percentage of SBR (Store, Bakery, and Restaurant) sales.
For a prospective franchisee, this means that in addition to a fixed rental fee, they can expect to pay additional costs that fluctuate based on factors like the overall upkeep of the shopping center, property taxes, and a percentage of their restaurant's sales. These variable costs can impact the overall profitability of the Moes Southwest Grill franchise.
Moes Southwest Grill's financial statements in 2024 show $3,516 in variable lease costs. In 2023, the variable lease cost was $3,478. These figures provide a historical context for understanding the scale of these costs. Understanding these variable costs is crucial for budgeting and financial planning as a Moes Southwest Grill franchisee, as they can influence the overall financial performance of the business.