The biggest factor in how much your restaurant costs to open is where you start. Different cities have different costs, but more importantly for you, the state of the space will largely determine how much it costs to make it suitable for guests to come and dine. Below I’ve distilled much of what I’ve learned over the course of opening different concepts in different kinds of spaces. Here’s a sample spreadsheet you can use (sheet one is a model, sheet two is budget and sheet three is revenue projections).

On the low end is taking over an existing restaurant space. The most expensive part of a new restaurant is the mechanical (heat, air-conditioning and vent hood), plumbing and electrical specific to a restaurant use. If someone else has already paid for all this, you stand to save substantially. Often a walk-in refrigerator and/or freezer is still in place. Bar, dining and production area layout, walls and finishes can also be an expensive part of starting a restaurant. If this is to your liking already then obviously you will not spend much money here either. The main costs in this scenario are equipment, furniture, final finishes and restaurant operations (inventory, training, smallwares, glassware and permits/licenses).

On the high end is new construction. The upside is you get to design the space exactly how you want it. The downside is all that cost falls on you and/or the landlord if you are leasing. The general mechanical, plumbing and electrical work for a commercial kitchen ranges between $70,000 and $100,000. Equipment can be about the same. For the rest of the space budget approximately $150 per square foot, plus furniture. In addition to the building costs there can be substantial costs associated with the parking lot and landscaping plus civic infrastructure such as sidewalks, curbs and gutters. Architectural plans can be up to 10% of total project cost, but at least $20,000. Civil, structural and MEP (mechanical, electrical, plumbing) engineer drawings usually add up to around 5% of total project cost, but at least $15,000.

The middle ground is going into existing shopping center-type space. Typically the landlord or previous owner will provide a “warm vanilla shell” in which basic construction is complete. This usually means ADA restrooms, electrical service and HVAC system is in place, with standard finish ceilings, floors and walls. This kind of space is move-in ready for an office user, but a restaurant user will need to make substantial improvements before the space can be used for food service. For budgeting purposes assume finished restaurant space when starting with warm vanilla shell will cost approximately $50-75 per square foot or if the space is a cold dark shell then $100-$125 per square foot. Note this does not include any equipment or furniture. Often the landlord will provide $5-$20 or more per square foot in tenant improvement allowance to help with the cost of making these improvements to the premises, which usually include increased electrical, mechanical and plumbing infrastructure.

To get real construction numbers you’ll need to provide a full set of plans to your contractors. This is not free, and costs can be in the range of those mentioned above. Most contractors with restaurant experience will give you a rough budget based on a sketch and equipment schedule, taking into account the condition of the premises. This can be a key information to help you decide whether to pull the trigger on a potential location/concept, and give you more basis on which to negotiate with the landlord/seller.