In this episode, Rick speaks with Karen Abrams, a leasing specialist for boutique fitness franchises. She provides a unique perspective for franchisees on negotiating fitness facility leases.
Karen is a preferred vendor with Alloy and has a wealth of information on leasing, entity creation, and business resales. This is one of many Alloy Franchise Perks: Benefits, Vendors, & Buying Groups.
Karen is an attorney and has been practicing law for almost 30 years. Not only is she a lawyer, but she also is a franchise owner. She’s built locations from the ground up, bought existing locations, and done SBA financing twice. She has realized success and failure.
She works exclusively with franchises and franchisees, doing everything from entity formations with LLCs and corporations, helping our clients with loan closings, and leasing documents and negotiations. They also do an extensive amount of due diligence and they also have a practice helping people who are buying and selling franchises.
She shares some sage advice on leasing, and other business functions critical to opening a fitness studio.
Advice For Negotiating Leases
Leasing a commercial property for your business is a huge investment, both financially and strategically.
Leasing contracts set the foundation for your entire relationship with your landlord and should not be taken lightly. Yet, many small business owners make the mistake of not having their lease reviewed by an attorney.
Commercial leases are complicated documents that cover a lot of ground. There’s a lot to consider, from rent payments to maintenance responsibilities, presale arrangements, competitor clauses, and more. If you don’t have a lawyer specializing in commercial leasing, you could put yourself at risk.
For instance, did you know some leases require you to foot the bill for air conditioning repairs, which can run into tens of thousands of dollars?
Also checkout this Site Selection Criteria For Locating A Gym, by Alloy Founder and CEO, Rick Mayo. We discuss the best site selection process to identify your ideal gym location, as well as a few important insights about gym design and gym traffic.
- Karen Abrams’ background and experience (01:17)
- Why an attorney needs to review and negotiate your lease (13:21)
- Nightmare stories in commercial real estate leasing (16:44)
- Letter of Intent in real estate (21:06)
- Top pieces of advice for someone negotiating a lease (27:46)
- Why the Personal Guarantee clause is critical (31:03)
- What happens when you sell your business? (32:26)
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