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Franchisees are a special kind of commercial tenant

When some Orange County entrepreneurs consider starting a business, they look to franchises. Since much of the business is already established, it allows for certain guarantees when it comes to the success of the business. In some ways, this also makes a franchisee a special kind of commercial tenant.

This is because much of such a lease is often intertwined with the franchise. Even so, each party reserves the right to negotiate the best lease terms possible under the circumstances. Having an attorney who understands both commercial leases and the particulars of franchises may help.

The process begins with the letter of intent. If a prospective franchisee and tenant accepts the terms, the negotiations can start. The first hurdle is to make sure that the terms agreed to in the letter of intent are in the proposed lease agreement. From there, each side negotiates the best terms possible.

In addition, the lease will need to ensure protection of the brand. In some cases, franchisees will also need to work with certain vendors, and that can be worked out as well. Whether this is a first lease or a renewal, obtaining the best terms possible is a goal of each party.

As a franchisee becomes a commercial tenant whether here in Orange County or elsewhere, numerous issues will need resolving. Even though some things may not be up for negotiation because they are particular to the franchise, other matters may be. Whether you are the franchise owner or the franchisee, you would more than likely benefit from understanding your rights and legal options when it comes to commercial leases whether they exist in standalone structures, shopping centers or malls.

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