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Restaurant Construction: How Smart Planning Adds Up

Planning a restaurant project? Call Encore Constructions.

Planning a restaurant construction project? Call Encore Constructions.

Restaurant general contractors are often asked, “How much does it cost per square foot to build a restaurant?” While the answer depends on a variety of factors, the ultimate cost depends heavily on a strong understanding of your lease, good communication, due diligence, and proper planning.  Here are some quick tips on lease negotiation and due diligence for your next project.

Negotiate a Fair Lease

It is important to negotiate a fair lease and to make sure you clearly understand all the terms and conditions.  If you don’t thoroughly review your lease, you run the risk of starting the process at a financial disadvantage and it’s unlikely that you will recoup the money you could lose.  For example, leasing a space that has existing adequate utilities and HVAC is ideal, but many landlords will offer “tenant improvement allowances” to offset the cost of any deficiencies.

Every lease is different, but it is generally reasonable to negotiate for a space or receive a tenant improvement contribution to get the space in top condition. Leasing a space in “shell condition” would offset a large portion of the costs associated with mechanical, electrical, and plumbing work. Keep in mind that costs associated with shell work can be a significant percentage of the total project cost!

Exercise Due Diligence

The best way to manage risk is to perform due diligence throughout the planning process and beyond. By thoroughly evaluating the proposed lease space for code compliance, legal issues, and deficiencies, you can accurately determine the true cost of your project.

The restaurateur should create a checklist, and work with their broker, attorney, and contractor to monitor and ensure that all items are being addressed properly.  At the same time and from the beginning, the broker, attorney, contractor, and other project members should work together with a team mentality and bring all of their concerns to the table. Implementing a teamwork approach allows all parties to identify concerns upfront and reach solutions with your best interests in mind.

Call Encore Construction

As a premier commercial general contractor, Encore Construction is proud to provide interior and exterior services in Baltimore, Maryland and beyond. We have an impeccable track record, an impressive portfolio, and an experienced team that is ready to tackle your next big project. Our results speak for themselves, and we’re proud of the work we continue to produce for our clients.

We have offices in Annapolis, MD and Ocean City, MD and we are happy to serve the Washington, DC, Baltimore, Northern, VA, Eastern Shore, MD and surrounding areas. Follow us on Facebook, Twitter, G+, and LinkedIn for news and updates! Do you want to discuss your project with a member of our team? Visit our website, and call us at (410) 573-5050. We look forward to hearing from you!

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