Description

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A lawyer can substantially increase a client's chance of success in a restaurant lease--or at least minimize the risk of failure--in two ways: first, by reviewing and negotiating the lease of the restaurant's premises, identifying and evaluating the risks and negotiating changes, and secondly, through the careful review and negotiation of the franchise agreement if the client pursues that option.

Franchised operations are popular for people investing in restaurants as this purchase can give restaurateurs a head start in terms of brand recognition, marketing, consistency of food quality, and service. However, signing a boilerplate franchise agreement is not necessarily a recipe for success. It is essential that the franchise agreement and the commercial lease harmonize so that adherence to one document does not cause a violation with the other.

Among the topics covered in the restaurant section are:

• Computation of rental charges and rent offsets
• Operational issues: hours, go dark provisions, definition of premises, and more
• Construction
• The emerging category of "grocerants"

This section concludes with an extensive array of restaurant leasing clauses, from CPI increases and rent stabilization clauses to language for premises issues such as lighting, valet parking, and more.

Chapters focused on working with a restaurant franchise consider issues related to the client, choosing a landlord and location, management, architect and general contractor, he franchisor and the franchise agreement, and the lender.

About the Author

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Mark Dall of Fishers, Indiana, has been practicing law since 1978 and is admitted to practice in both Indiana and Arizona. Since 1984, he has worked as a real estate attorney for the largest shopping center developer in the United States, with a focus on retail and restaurant leasing. Noble C. Hatfield practices leasing, real estate, and transactional law in Indianapolis, Indiana. With over 25 years in practice, he focuses on strip center development and leasing and has extensive enclosed mall background.