THE AGENCY

Item 7 lays out a wide initial investment range of $119,600 to $896,150, reflecting flexible office setups from modest to premium in prime markets, with the $47,500 franchise fee on the lower end for real estate categories where norms hover $50K-$100K. Royalties start at 6% tiering down to 4% based on volume, paired with 1.2% brand/ad fees dropping to 0.75%, but a standout $150,000 minimum annual royalty enforces skin-in-the-game—unusual for mid-sized systems and signaling expectation of $2.5M+ gross commissions to break even on fees alone. From 40 franchise units in 2023 to 54 in 2024 (+35% growth), alongside 37 corporate locations and 28 projected new units, the system shows healthy momentum since franchising in 2015; just 2 terminations flag low distress versus category averages above 5-10%.

No Item 19 means no validated average revenues or profits, a red flag in real estate where top performers can exceed $5M+ GCI but variability is huge—leaving due diligence reliant on FDD Items 20/21 (low churn) and proprietary platforms for lead gen. SBA default rates aren't detailed here, but the tiered incentives reward scalers in hot markets. For investors with brokerage experience and $500K+ capital, this could yield outsized returns amid luxury booms; novices face steep ramps with that min royalty looming—weight expansion against opaque earnings before committing.