What is the total amount of future minimum lease payments for a Stretch Zone franchise?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
d 2022 is 4.45 and 5.45 years, respectively. The weighted average discount rate of the remaining leases at December 31, 2023 and 2022 is 1.38%.
Future minimum lease payments are as follows:
| Year Ending December 31, | |
|---|---|
| 2024 | $ 182,981 |
| 2025 | 141,224 |
| 2026 | 136,011 |
| 2027 |
Source: Item 3 — Franchisee/Debtor's Warranties. (FDD pages 263–364)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the company's future minimum lease payments are detailed in Note H - Lease Commitments. As of December 31, 2023, the total future minimum lease payments amount to $720,318. This figure represents the aggregate lease obligations Stretch Zone Franchising, LLC is committed to paying over the coming years. This total is before considering amounts representing interest, which are accounted for separately. The present value of these net future minimum lease payments, after accounting for interest, is $687,811.
Breaking down the future minimum lease payments, in 2024, the company is obligated to pay $182,981. For the subsequent years, the amounts are $141,224 in 2025, $136,011 in 2026 and $140,092 in 2027. The lease payments drop to $120,010 in 2028. These payments are associated with the company's operating lease for office space and a training facility, which commenced in March 2021 and extends for ninety-one months, terminating in 2028.
Prospective franchisees should note that these figures pertain to the lease commitments of Stretch Zone Franchising, LLC itself, and not necessarily the lease obligations a franchisee would incur for their own location. Franchisees will need to secure their own locations and negotiate lease terms, which will vary depending on location, size, and other factors. Understanding the franchisor's lease commitments can provide insight into the company's financial obligations and stability, but it's essential to differentiate these from the individual franchisee's responsibilities.