![]() Restaurant real estate costs in New York City are the highest in the United States. New York City restaurant rent and utility costs you’ll pay more for the sensors up front, but note that every 1,000 kwt you save is about $100 off your utility bill – so if you have the cash, consider the investment one that will pay for itself over time. Money-saving tip : install occupancy sensors in walk-in coolers and storage areas that turn off or turn down equipment automatically. If you’re located in a hot or cold climate, you’ll spend more on cooling or heating costs compared to a restaurant located in a more temperate climate. Your water, heating, and electricity bills, however, will also depend largely on where you’re located in the country. includes $2.90 per square foot per year on electricity, and $0.85 per square foot/year on natural gas. The average restaurant utilities cost in the U.S. ![]() ![]() To get an accurate estimate on how much your restaurant will spend on utilities, you’ll need to know the approximate square footage of your space. Be careful: if you have a great month your rent can actually double!Ĭommercial electricity use in the United States costs an average of 11.0¢/kWh. Upside: You pay only your baseline rent if your sales that month fall at or below your projected sales level.ĭownside: If your restaurant makes more than the agreed sales amount, your landlord collects an additional percentage of rent. a percentage deal uses an agreed-upon level of sales to determine a baseline rent, which is ideally lower than what you would pay without a percentage deal. Pro tip: ask your prospective landlord(s) if they would be willing to offer you a percentage deal. Make sure to negotiate or find another space if you’re staring down this ratio. You’re in a bad place if your lease is 15% of your revenue – the extra five percent will cut into your profit margin and prevent you from budgeting for extraneous costs. So if you own a neighborhood restaurant that makes $800,000 per year in sales, you should expect to pay $40,000 to $64,000 per year for your lease.īut if your restaurant is located in downtown Manhattan – the most expensive market in the United States – your rent may push upwards of 13% of your revenue. If your restaurant is located in a small town or suburban area, you can expect to fall on the lower end of the spectrum, between five to eight percent. In general, how much does it cost to start a restaurant? An average restaurant rent cost, or lease, should be five to ten percent of its total revenue.
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