Finding the perfect location for your restaurant is not an easy process. After seeing countless spaces, you may be inclined to sign a lease for the first place that looks like it may suit your business. But rushing into a space could leave your restaurant at risk from Day One.
Once you’ve decided to make an offer on a space, AllDay highly recommends that you hire a general contractor to examine your proposed location before signing a lease. Even if you are enamored with a space on your first visit with a broker, the fresh coat of white paint may hide some expensive problems. A general contractor will be able to identify potential pitfalls and liabilities of a property.
Kash Singh of Aerial Design and Build, recommends that prospective restaurateurs engage a general contractor to join on walkthroughs. “An experienced general contractor can help you understand what you are getting into,” says Kash. “You should know if you will need to put $300,000 or $1 million in renovations before you sign a lease.” Many general contractors will charge a nominal fee to examine a space, a return that usually pays itself back in multiples if you avoid an out of code or damaged property.
Kash recommends doing some research before you even visit a site with a broker. Building code violations and stop work orders for most addresses are available online and a quick search can save you a trip to a site that may have a history of violations. The nature of the violations and their resolutions can also provide you with a bit of insight into your prospective landlord. You can find these violations online at the Department of Building’s website. LINK HERE: http://a810-bisweb.nyc.gov/bisweb/bsqpm01.jsp
The most common and expensive issues are usually electric or gas related. Spaces that were not previously restaurants may lack the proper electrical or gas supply to support a kitchen. Upgrading a space’s utilities are expensive and can take months to complete, adding costly delays to your opening. Other common issues include structural damage, improper venting of kitchen fumes to the outside, and plumbing code violations. “Make sure you turn on the AC and heat before you sign a lease,” say Kash. “Even if the landlord tells you that it works, make sure you check.” Fifteen-year-old appliances may be on their last legs.
Depending on the age of property, the space may be grandfathered into updating certain fixtures to code such as being Americans With Disabilities (ADA) compliant. Once you’ve started to make significant changes to your space, you may be required to update the entire facility to code, regardless if the changes are pertinent to the ADA. For example, simple renovations in a bathroom like changing the paint color or light fixtures should not affect a restroom’s compliance but changing the sink or toilet location may.
If you decide to continue to move forward with a location with surmountable issues, a general contractor can provide you with a cost estimate of the necessary renovations, allowing you to negotiate changes to your lease and rent with the landlord. Landlords, in general, should be financially responsible for certain mechanical building compliance, and structural renovations but leases may stipulate that a property is being leased “As Is”. If so, this may absolve the landlord for the financial responsibility of making the legally required updates to the facilities in line with building codes.
Kash recommends looking for spaces that previously held a restaurant tenant. Usually, these locations have the proper venting, gas, and electric needed by a kitchen. Regardless, AllDay recommends having a professional do your due diligence before finalizing a lease.
AllDay Industry has the experience and the network to help you develop your concept from any stage of development. From finding the perfect space, hiring the right executive chef, or designing the restaurant of your dreams, our team will act as your primary consultant to connect you to some of the best talent in the hospitality industry. Contact us at 212.346.0606 or firstname.lastname@example.org.
To learn more about Kash Singh and Aerial Design and Build, check out aerialdesignandbuild.com.