The Challenge
It was immediately clear that the biggest hurdle we’d have to overcome was market saturation. The particular location the franchisee was interested in had an abundance of large restaurant operators. Not totally saturated, but close.
The Approach
In order to remedy this challenge, we had to get creative. We identified an existing freestanding 8,000 SF restaurant business for sale. We jumped at this opportunity, as it was well-located and would essentially replace a community dining option rather than adding a new one.
The building was on a ground lease, so we were able to negotiate the purchase of the FF&E with the business broker. There were 4 years left on the ground lease, so we went straight to the Landlord and came to terms on a brand-new lease for 20 years with options.
We were able to manage relationships with 3 different parties within the overall transaction. The client, the landlord and the restaurant owner. We knew our client wouldn’t buy the FF&E unless we were able to negotiate a longer lease term with the Landlord. Both contracts were contingent on the other.
The Outcome
There were several parties involved in the overall transaction, and we expertly navigated the needs of everyone. What could’ve easily been a $295,000 Asset Purchase, turned into a $2.8M Ground Lease + Asset Purchase. From the first day of property tours, it took exactly 40 days to close both deals. Our clients were very satisfied with outcome and are gearing up for a grand opening of the Anchor Bar location in Spring 2024.
