The Lease Is the Foundation — or the Flaw
Coffee shops are location businesses in a way few other categories are. Foot traffic, visibility, proximity to residential density or office concentration, and parking determine a coffee shop's revenue ceiling and the lease controls whether any of that value is yours to keep. A coffee shop with a lease expiring in 18 months, or one that requires landlord consent to assign and the landlord has historically been uncooperative, is a materially risky acquisition regardless of how strong the current financials look. Leases with 5+ years remaining and explicit assignment rights are the standard for any acquisition worth pursuing at full price. Anything shorter than three years remaining warrants a significant discount or a landlord extension commitment as a condition of closing.
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