What is the Nothing Bundt Cakes policy on landlords contributing to finish-out costs?
Nothing_Bundt_Cakes Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 7: ESTIMATED INITIAL INVESTMENT]
These fees are not included in our estimate and you should determine if you will have to pay these fees, and the amount of such fees, before you purchase the franchise.
The leasehold improvement ranges will be affected by various factors, such as the location of the Bakery and local market conditions.
Your actual costs may or may not include site preparation, demising walls, and utility extensions, depending on the arrangements you negotiate with your landlord.
The estimates assume that the landlord will provide connections to adequate electrical, gas, water and sewage service.
Some landlords are willing to contribute toward the cost of finish-out, which reduces the overall leasehold improvements costs.
Bakery Improvements.
Bakery improvement costs, including a modified, above-ground grease trap, electrical, carpentry, and similar work, and contractor's fees, depend on: the Bakery's condition, location, and size; the demand for the site among prospective lessees; the site's previous use; the build-out required to conform the site for your Bakery; and any construction or other allowances the landlord grants.
The figures above include a low of $10,000 and a high of $117,000 in Tenant Improvements, and these reimbursements and credits are paid to you after construction is completed by the landlord.
Sometimes these payments may take 3 to 6 months from the time your Bakery is open for you to receive them.
You may negotiate for the landlord to bear more of these costs even though they may amortize those costs in your monthly rent.
You may not act as your own general contractor but must use a licensed, bonded contractor with food/restaurant build-out experience.
Also, if these costs may be negotiated, you may further reduce your costs.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 30–36)
What This Means (2025 FDD)
According to Nothing Bundt Cakes' 2025 Franchise Disclosure Document, landlords may contribute to the finish-out costs of a new bakery location. The FDD indicates that these contributions can reduce the overall leasehold improvement costs for the franchisee. These potential contributions are factored into the estimated initial investment for bakery improvements, which range from $275,000 to $350,000. The document specifies that the figures include a low of $10,000 and a high of $117,000 in Tenant Improvements, which are reimbursements and credits paid to the franchisee by the landlord after construction is completed. These payments may take 3 to 6 months to receive after the bakery opens.
Nothing Bundt Cakes allows franchisees to negotiate with landlords to cover more of the finish-out costs, potentially amortizing these costs into the monthly rent. This could be a significant benefit for franchisees, reducing their upfront capital expenditure. However, the FDD also notes that the leasehold improvement ranges are affected by various factors, including the location of the bakery and local market conditions. The estimates provided assume that the landlord will provide connections to adequate electrical, gas, water, and sewage service.
It is important to note that franchisees cannot act as their own general contractor and must use a licensed, bonded contractor with food/restaurant build-out experience. The FDD advises prospective franchisees to determine if they will have to pay certain fees and the amount of such fees before purchasing the franchise. Overall, while landlord contributions are possible, they are subject to negotiation and local market conditions, and franchisees should carefully consider these factors when planning their initial investment.