build a restaurant?

[WGGJR]

I would look at used equipment or search for a restaurant that closed and needs to liquidate the equipment.   I would not buy new unless you are sure the restaurant will work.  The price difference between new and used equipment can be a lot and the used equipment can function just as well.

Restaurant business is tough.  In one respect, no other industry offers an opportunity to so easily make folks happy, give them good food and lots of drinks.   But, only one out of ten will succeed past their first year.   A restaurant is one of the toughest commercial projects to pull off.  Much of the profit is in the bar but adding a bar to a restaurant brings an entirely new set of problems including acquiring a liquor license (one may not be available) and liability.  It also takes a long time to build a positive cash flow with one and the need for expendable capital in that first year can take its toll, especially when staffing levels and the freshness and quality of inventory needs to be maintained.

From a development point of view, and not an operating point of view, it might work if a long term lease is signed with a chain that can guarantee.  A good chain as an anchor might bring other retailers as tenants.  But, restaurants are built out to a specific use and if the tenant is not successful, it will cost to convert the space to other uses.    Every person we know in the restaurant business lives in their restaurant and works it every hour of every day.  Very tough business.

Here is one strategy that might work.  Do not develop an individual restaurant but a mixed use property.   We have seen buildings developed with retail or restaurants on the ground floor and either residential or office above.  Instead of trying to rent, all the units are made into condos and sold, including any commercial space.   Once sold, you are out as the developer and do not have to worry about the performance of the tenants.  Just an idea.

I agree! My wife and her parents are in the restaurant bussiness. It has been successful but they live there. In fact they are selling it because of their health. They started with a shack and built it up over time. They've had it about 10 yrs. It is actually a convience store with a cafe in it, but the cafe is what makes the money.

Why work your buns off in a restaurant when you can sit and eat cheese in your underwear as an investor.