1851

Many franchise concepts require a brick-and-mortar shop, which means you may find yourself in need of some lease negotiation skills. 1851 Franchise spoke with&nbsp;<a href="https://www.linkedin.com/in/timmurphyceo/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=essential-lease-negotiation-tips-for-franchisees-2725451" target="_blank" rel="nofollow">Tim Murphy</a>, real estate broker and CEO of&nbsp;<a href="https://boomersparks.com/franchise/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=essential-lease-negotiation-tips-for-franchisees-2725451" target="_blank" rel="nofollow">Boomers Parks</a> for some helpful insights on how to handle franchise lease negotiations like a pro.&nbsp;<h3>Find a Space that Aligns with Your Needs&nbsp;</h3>First things first, before you can negotiate a lease, you’ll need to find a space that meets the needs of your business. Location should, of course, be a top priority. You’ll want a property that’s easily accessible (either by car or by foot) and provides good visibility for consumers. You’ll also need to consider what services you’ll be providing or products you’ll be displaying to ensure the functionality of the layout of the space.“It’s essential to focus on what is best for the franchise,” said Murphy. “Do your research on the size and layout of the space. Does it have all the amenities you’re looking for? Is the location appropriate for the brand? These are questions that may need to be considered prior to signing the lease.”Consider your plans for growth to determine if the space will help or hinder your progress. Beyond the location and the physical layout, your budget will play a crucial role in your property selection. While you can narrow down your search based on your financial situation, there is also room for lease negotiation to improve the deal you are signing on for.<h3>Understand the Lease Agreement</h3>A lease agreement document can be quite complex, so be sure to read it carefully and seek professional help from a real estate lawyer if you are unsure about any of the terms. Understanding the lease type and negotiating favorable terms can have a big impact on costs and, as a result, on your business’ success.“Make sure you fully understand the terms of the franchise agreement; ensure it suits your budget, seek hidden costs and discuss renewal terms for the future,” said Murphy. “Ultimately, you want to ensure the space will give you the highest value for your investment.”Key factors to consider include: lease duration and renewal options, potential rent increases over time and the base rent versus the actual total cost of renting the property.The base rent is typically straightforward, but you also need to consider the additional costs of property taxes, insurance, potential common area maintenance fees and utilities. Some fees will be paid by the landlord while others must be paid by the tenant, so make sure you understand which payments will be your responsibility.You should also consider negotiating a tenant improvement allowance. If you take care to assess the space and any updates its needs, you may be able to negotiate a contribution from the landlord for updates or changes that suit your brand.Negotiating fair and flexible exit clauses will allow you to exit your lease agreement or sublease the property should your plans change in the future.&nbsp;<h3>Leases Are Negotiable; Your Success Shouldn’t Be</h3>According to Murphy, it never hurts to ask: “If there’s something in the agreement you aren’t in favor of, offer a solution.”If your negotiation efforts are not as fruitful as you would’ve liked, remember that you’re not obligated to follow through with an unsigned agreement. There may be something better suited for your needs out there.“If negotiations do not lead to the terms of the lease being suitable for your franchise's needs, walk away from the deal,” said Murphy. “Remember, you want this space to help your franchise grow and to see success.”Want to learn more about lease negotiation strategies and franchisee real estate issues? Check out these stories:<ul><li><a href="https://1851franchise.com/10-facts-franchisees-need-to-know-about-real-estate-leases-2723029">10 Facts Franchisees Need to Know About Real Estate Leases</a></li><li><a href="https://1851franchise.com/the-8-essential-real-estate-questions-franchisees-should-ask-franchisors-2721705#stories">The 8 Essential Real Estate Questions Franchisees Should Ask Franchisors</a></li><li><a href="https://1851franchise.com/franchiserealtypartners/how-to-master-lease-negotiations-in-the-franchising-industry-2718812#stories">How to Master Lease Negotiations in the Franchising Industry</a></li></ul>

Lease Negotiation Tips for Franchise Success

1851 Franchise

No lease is set in stone before you sign it. In this article, real estate expert Tim Murphy offers advice on negotiating your lease to get the most out of your franchise space.

Essential Lease Negotiation Tips for Franchisees

essential-lease-negotiation-tips-for-franchisees

Voodoo Brewing Co.

Why I Bought: How Alex and Chrissy Bergren Turned Their Passion for Craft Beer Into a Thriving Voodoo Brewing Co. in Virginia Beach

why-i-bought-how-alex-and-chrissy-bergren-turned-their-passion-for-craft-beer-into-a-thriving-voodoo-brewing-co-in-virginia-beach

Beef 'O' Brady's

Beef 'O' Brady's - Brass Tap - Q1 2025 Momentum - 1851 Franchise

Beef ‘O’ Brady’s and The Brass Tap Kick Off 2025 With Growth, Innovation and Record Sales for Q1

fsc-franchise-co-q1-2025-momentum

BoConcept

Creating the Perfect Outdoor Space: BoConcept’s Tips for Making Outdoor Living Cozy and Stylish

creating-the-perfect-outdoor-space-boconcept

Right at Home

Albano Mahilaj Turned Personal Challenges Into a Purpose-Driven Right at Home Franchise

right-at-home-franchise-albano-mahilaj

Layne's Chicken Fingers

Photo of Layne's Chicken Fingers restaurant after dark with red lights around top of building

Layne’s Chicken Fingers to Expand in Mid-Atlantic, Bringing Its Soon to Be FamousTM Flavor to New Markets

laynes-chicken-fingers-mid-atlantic-expansion

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

The Future of Franchising: Trends and Predictions for 2025 and Beyond

the-future-of-franchising-trends-and-predictions-for-2025-and-beyond

Restaurant Business: Crumbl Cools Its Expansion, Refocuses on Profitability

restaurant-business-crumbl-cools-its-expansion-refocuses-on-profitability

Franchise Face-Lifts: Why Major Restaurant Brands Are Betting Big on Remodels

franchise-face-lifts-why-major-restaurant-brands-are-betting-big-on-remodels

How New Tariffs Are Causing Price Hikes and Surcharges for U.S. Businesses and Franchises - 1851

Tariffs Prompt Price Hikes, Surcharges as Businesses (and Franchises) Brace for Rising Costs 

tariffs-prompt-price-hikes-surcharges

Pizza Hut - EYM Group - Chapter 11 Bankruptcy - 77 Pizza Hut Locations Sold - 1851 Franchise

77 Pizza Hut Locations Sold After Franchisee Bankruptcy Filing

pizza-hut-franchisee-bankruptcy-eym-group

Franchisee spotlight image with Randy and Sandy Craft, Children's Lighthouse logo on blue background

The Crafts’ Successful Journey from New Parents to Children’s Lighthouse Franchisees

the-crafts-successful-journey-from-new-parents-to-childrens-lighthouse-franchisees

Franchise Success Stories: Inspiring Tales from the Front Lines

franchise-success-stories

Amateur Bodybuilder and Business Partner Bring Passion for Fitness to World Gym Franchise in Fulton, New York

amateur-bodybuilder-and-business-partner-bring-passion-for-fitness-to-world-gym-franchise-in-fulton-new-york

franchisee spotlight graphic with photo of Venetya Evans and Sylvan Learning logo

IT Leader Celebrates One Year of Sylvan Learning in Simi Valley: A Passion for Education and Technology Drives Her Mission to Help Students Succeed

it-leader-celebrates-one-year-of-sylvan-learning-in-simi-valley

Most Profitable Restaurant Franchises To Own in 2025 - 1851 Franchise

The Most Profitable Restaurant Franchises to Own in 2025

most-profitable-restaurant-franchises-to-own

Image of building outline hovering over person's hand

How To Choose the Right Franchise: A Step-by-Step Guide to Success

how-to-choose-the-right-franchise-step-by-step

Lindora’s New President Discusses Franchise Growth and the Future of Health and Wellness

lindoras-new-president-discusses-franchise-growth-and-the-future-of-health-and-wellness

Essential Lease Negotiation Tips for Franchisees

MORE STORIES LIKE THIS