property & leasing
An older building may require further upkeep and maintenance, which tenants pay for in Common Area Maintenance (CAM) charges. If there has been a high turnover of tenants in the past, for any reason, this should raise a red flag for you.
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Who is doing the leasing for the property? Knowing who you are dealing with will help you better prepare for negotiations. Is this a big leasing brokerage, a real estate agent, an employee of the franchisor or premises owner or a family member of the landlord? Franchisors, like Real Estate agents must follow a code of conduct; however, they often can only share what the landlord has told them. A less-than-reputable landlord doing his own leasing may tell you anything to get you to sign.
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Who were the two most recent tenants to move in and when? You will want to approach these tenants and ask them how their lease negotiations went. If the leasing agent claims he or she has only recently acquired the listing and does not know, push for the details. Similarly, a franchisor should have a detailed history of the premises and be able to provide all of this information to you before entering into any franchise agreement, an agreement to occupy the premises with the franchisor, or a lease with a landlord or real estate/leasing agent.
28 | Modern Franchise Magazine
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