How do I explain my commissary kitchen’s tenant agreements to a buyer?

Buyers pay close attention to tenant agreements, because they show the kitchen’s future income. Gather everything in one place. If some arrangements are only verbal, say so, and consider whether to put them in writing before the sale. Gaps are easier to fix before a buyer asks about them.

Prepare a summary table. For each tenant, list the space or hours, the term, how renewal works, how billing is done, who covers cleaning and equipment use, and any exclusive rights or discounts. Mark anything unusual, such as a tenant with special access or a promise you made. Be ready to walk through the documents in person. Explain why certain terms exist and how they play out in practice. Ask your lawyer which agreements can pass to a buyer, whether tenants need to be told or give consent, and how the letter of intent and purchase agreement should describe them. Keep your answers consistent so the buyer can trust what you provide. Keep a list of questions tenants have asked you over time, since a buyer can learn a lot about where the agreements are unclear.

Key takeaways

• Gather all agreements and note any that are only verbal.
• Prepare a summary of terms, renewals and unusual conditions.
• Ask your lawyer which agreements transfer and what tenants must be told.
• Keep a list of questions tenants have asked you before the buyer asks to see them.