Most franchise owners sign a lease based on the rent per square foot and the location's visibility. They see a clean concrete floor and high ceilings and assume they have a blank canvas.

In the GTA, that assumption is how you lose your first two months of profit before you even pick up a hammer.

When a landlord hands you a space "As-Is," they aren't just giving you the walls. They are giving you their deferred maintenance, their outdated electrical panels, and their non-compliant plumbing.

The Infrastructure Illusion

You see a shell. An inspector sees a liability.

If the previous tenant was a retail clothing store and you are opening a quick-service restaurant, your "As-Is" space is actually a deficit.

In Toronto, many older commercial units have 100-amp or 200-amp service. A modern franchise kitchen often requires 400-amp to 600-amp service to run ovens, walk-ins, and HVAC.

If your lease says "As-Is," the $15,000 to $30,000 cost to bring more power from the street to your panel is your problem, not the landlord’s.

The Hidden HVAC Trap

We see this repeatedly in Mississauga and Vaughan developments. A tenant signs a lease thinking the rooftop HVAC unit is functional.

Three weeks into the build-out, the mechanical contractor discovers the unit uses R-22 refrigerant, which is phased out, or the heat exchanger is cracked.

Because you accepted the unit "As-Is," you are now responsible for a $12,000 replacement. This doesn't just hit your capital expenditure; it delays your balancing report, which delays your final occupancy permit.

Every day the unit sits idle is a day you pay rent without ringing a till.

The Plumbing Perimeter

In Ontario, building codes regarding grease interceptors and accessibility are strict.

If the existing "As-Is" washroom isn't AODA (Accessibility for Ontarians with Disabilities Act) compliant, you aren't just painting the walls. You are Jackhammering the slab to move drains.

If the landlord didn't provide a designated knockout or a deep enough sanitary line, you are paying for the structural engineering and the specialized labor to fix it.

How to Protect Your Margin

Before the lease is fully executed, you need a Site Investigation Report.

Do not trust the marketing brochure. Do not trust the "typical" floor plan provided by the broker.

1. Verify Utility Caps: Know exactly how much water, gas, and power enters the space.

2. Inspect the Roof: Have a technician verify the age and life expectancy of the HVAC.

3. Check the Slab: Ensure the plumbing exits the building where the drawings say it does.

The goal is to move these costs back to the landlord or secure a Tenant Improvement (TI) allowance that covers the "invisible" work.

Infrastructure should be the landlord's investment. The brand-standard finishes should be yours. When you pay for their infrastructure, you are effectively paying their mortgage twice.

Build with foresight, or pay for the hindsight.

If you would like a technical review of a potential site before you sign your lease, you can book a consultation here.