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Catering, Food Handling and Awareness *OnTopic* Forum to educate us on safe food handling. Not specifically for Catering or competition but overall health and keeping our families safe too.


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Unread 12-08-2011, 01:47 PM   #1
Ryan Chester
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Default Have You Opened A Restaurant In a Location That Wasn't Previously a Restaurant?

Have any of you opened a restaurant (of any sort) in a space that was not previously a restaurant? It's obvious that opening in a pre-existing location is ideal (financially) and would certainly make every effort to do so.

I've been approached to open a BBQ/Micro Brew restaurant (nothing huge). I would handle the Q and he would handle the brew. His buddy is a successful restaurateur who ones a 7 chain restaurant who would either be willing to help or be a partner which would be HUGE. Nonetheless we will have experienced guidance and assistance.

I have been looking at locations and pre-existing restaurants are hard to come by in the areas we are looking at. I found some excellent places but they are "shells". If we got a shell, we would have to do a complete build out to include equipment, grease interceptor, plumbing, ventilation system, permits, etc. which could be extremely expensive. I know we can potentially offset some of the expenses through negotiations in the lease but it will still be costly.

If any of you have opened a place that was not a pre-existing restaurant location and had to do a full build out, I would love to hear how it worked out for you.
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Unread 12-08-2011, 03:41 PM   #2
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remember on a build out you have to cut up the floor for all the plumbing and maybe electrical.

And as a sprinkler fitter myself, if you move or add walls or even eliminate walls you have to redo your fire sprinklers
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Unread 12-08-2011, 03:50 PM   #3
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Quote:
Originally Posted by kurtsara View Post
remember on a build out you have to cut up the floor for all the plumbing and maybe electrical.

And as a sprinkler fitter myself, if you move or add walls or even eliminate walls you have to redo your fire sprinklers
All the places I have looked at have no walls. Completely open so that helps I suppose.

Here are two properties I have looked at. As you can see that are completely open. No walls.



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Unread 12-08-2011, 09:20 PM   #4
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The first one is sprinkled but if you added walls, built out a kitchen you would have to add or move sprinklers.

The second one does not look like it is sprinkled, around here if you remodel a building to change it's use to something new you have to meet the current codes, meaning you would probably have to sprinkle it.

Plus either one when you add a kitchen hood you have to supply make up air for the air you are sucking out of the building which means cutting wholes in the roof.

Being neither one was a restaurant it is more work than some think it is
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Unread 12-08-2011, 10:37 PM   #5
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I have a restaurant and the building in five years old, you dont always need sprinklers. The build out is expensive. Cutting the floor up sucks too, but if you want it bad do it. Do most of the stuff yourself.
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Unread 12-09-2011, 10:04 AM   #6
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Quote:
Originally Posted by Jacked UP BBQ View Post
I have a restaurant and the building in five years old, you dont always need sprinklers. The build out is expensive. Cutting the floor up sucks too, but if you want it bad do it. Do most of the stuff yourself.
I bet he would need sprinklers in California
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Unread 12-09-2011, 11:36 AM   #7
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Yes I converted a shell into a bbq restaurant and will never do it again. The thing that killed me was the equipment that got back ordered 4 months, all the while paying rent, utilities, printers, and insurance not to mention missing some of the best months of the year, plus raising with 3 kids and no income, eating into my working capital. So If I ever open up again it will be an established fully equipped business that will only need some personal touches to make it mine and if there is not one in my area then I will either expand my search or move on to some other venue.

But what has not been addressed here is the partnerships. I don't care how good a friend either one is they most likely wont be soon and you will stand to lose friends. In your case you already have two votes against you. What if one side of the business does better than the other side, how are we splitting the duties, bills and profit loss/gains? Do you have a plan in place if one or more wants to back out down the road?

I did not have a partner in the restaurant but I have had them in a couple other ventures and they did not work out. I will take some blame here because I am probably not the best sort for a partnership.

I seriously hope things work out for you but in my opinion you are stacking the deck big time, against it working from the get go.
Dave
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Unread 12-09-2011, 11:53 AM   #8
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Quote:
Originally Posted by Mo-Dave View Post
Yes I converted a shell into a bbq restaurant and will never do it again. The thing that killed me was the equipment that got back ordered 4 months, all the while paying rent, utilities, printers, and insurance not to mention missing some of the best months of the year, plus raising with 3 kids and no income, eating into my working capital. So If I ever open up again it will be an established fully equipped business that will only need some personal touches to make it mine and if there is not one in my area then I will either expand my search or move on to some other venue.

But what has not been addressed here is the partnerships. I don't care how good a friend either one is they most likely wont be soon and you will stand to lose friends. In your case you already have two votes against you. What if one side of the business does better than the other side, how are we splitting the duties, bills and profit loss/gains? Do you have a plan in place if one or more wants to back out down the road?

I did not have a partner in the restaurant but I have had them in a couple other ventures and they did not work out. I will take some blame here because I am probably not the best sort for a partnership.

I seriously hope things work out for you but in my opinion you are stacking the deck big time, against it working from the get go.
Dave
My "friend" is actually my boss so we wouldn’t necessarily have to worry about the loss of income during the transition phase since he is paying me anyway. Nonetheless I completely here what you are saying. I could never do it on my own so a partnership is my only option but I will not proceed if I don't think we have a good chance at success. This is one reason I want to partner with his friend who owns 7 restaurants locally because he knows what it takes to make them work. We are in the absolute infant stages and have a lot of things to discuss.

Thanks for your input Dave, I really appreciate it.
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Unread 12-09-2011, 01:03 PM   #9
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A couple of points:

I was in partnership in my business for years and my partners remain good friends to this day, even though we are no longer in business. I worked with them for over 18 years, so much like marriage, some go well, some do not. Doesn't mean it isn't worth trying.

At least in California, even if you buy an established business, it does not mean you will not have to refit or retrofit. I know of one busioness that expended over $100,000 to refit a BBQ business that was already a BBQ business. But, once they bought, they triggered code review and a lot had to be fixed. Another had to redo all of their appliances, as gas connections and electrical connections did not meet current code, again, loads of delays.

My advice, get a good real estate expert and a very good architect, with experience in the restaurant business and really understand the code. Or, alternately, find a way to make friends with the local inspector and find out exactly waht you need. My experience has been that folks listen to the "experts" in business and never consider that they should talk to the inspectors, who really are the gate keepers.
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Unread 12-09-2011, 01:11 PM   #10
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Quote:
Originally Posted by landarc View Post
A couple of points:

I was in partnership in my business for years and my partners remain good friends to this day, even though we are no longer in business. I worked with them for over 18 years, so much like marriage, some go well, some do not. Doesn't mean it isn't worth trying.

At least in California, even if you buy an established business, it does not mean you will not have to refit or retrofit. I know of one busioness that expended over $100,000 to refit a BBQ business that was already a BBQ business. But, once they bought, they triggered code review and a lot had to be fixed. Another had to redo all of their appliances, as gas connections and electrical connections did not meet current code, again, loads of delays.

My advice, get a good real estate expert and a very good architect, with experience in the restaurant business and really understand the code. Or, alternately, find a way to make friends with the local inspector and find out exactly waht you need. My experience has been that folks listen to the "experts" in business and never consider that they should talk to the inspectors, who really are the gate keepers.
Thanks buddy. Just so happens 2 of my good friends (both attorneys)were the top dogs at Grubb & Ellis so they definitely know the real estate game. They left Grubb to open a law office who deals with securities (investment) law. They will definitely be a huge asset and offered to negotiate and write all the contracts.
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Unread 12-09-2011, 02:08 PM   #11
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I agree with landarc some partnerships do work but it takes a special kind of person to make it happen and that will take an effort on everyone.
Dave
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Unread 12-11-2011, 05:17 PM   #12
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I am a GC. I have built out 5 restaurants this year alone.

It can be worth the wait to find an existing location. Dealing with venting your smoker is going to be expensive, but the cost of adding a complete new kitchen is almost always cost prohibitive for a start up.

The other side of that is on a new build out keeping to budget is much easier. There should be no surprises and you will get exactly product you planned on.
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Unread 12-11-2011, 05:58 PM   #13
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New build out. Every problem imaginable. Opened 2 months late.
WAY bigger than ur looking at but very expensive.
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Unread 12-12-2011, 08:57 AM   #14
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Been there and done that. What you spend on the build out will not be recovered for many years and you need all the cash you can get your hands on for the first few years. Keep looking for a location with a prior restaurant built out, you won't regret the time spent looking. Partner, been there done that! Everything was great while we were building out the restaurant but when we opened he thought he was at his own party every day and sat at the bar and drank or was coming in late, leaving early or not showing up. I walked out one day and never looked back. He closed the restaurant within a year. Too bad, we were profitable within the first two months but I wasn't going to put up with it especially when I found he was skimming off the top and not paying the bills. Good luck.
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Unread 12-20-2011, 04:02 PM   #15
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How exciting Brother! Big advice: the zoning guy should be your new best friend before going into anything or leasing or buying..... Almost got a dee-vorce when wifey bought the new place and didn't check on all those little rules and regs and zoning issue bi-laws BEFORE converting....mucho dinero later, lots of blood, sweat and tears (and permits) and more tears, and some even sobs...we had things straight away. Depending on where you are some states have townships which have their own bilaws. So let's just say on this block you may be good but right over the line can be $10K more to get up and running....still...having...nightmares...
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