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Been trying to google a prominent (Chicago?) restauranteur with a couple michelins who ended up being priced out of her own lease, despite acclaim..
just watched Eat This New York documentary last night, and was wondering if anyone knew of restaurant owners who purchased their space as opposed to lease, thanks.
I'm sure there are some. But remember a lease is a low-cost and low-down-payment form of financing -- and if you're starting a business, you would generally rather put all your capital into the restaurant operation. So in addition to raising cash and maybe getting bank credit, you 'borrow' space by leasing it -- let the building owner tie up his cash on owning; you focus on generating income.
There is a restaurant that occupies the ground floor of our building, we are in a coop, they own it.
Let the LL tie up his capital. Wholeheartedly agree. Borrow apt by renting. Invest in sprint and make billions of dollars.
Veau d'Or owns their building (and has for a very, very long time).
Most lifespans of restaurants are 7yrs. anything older than that and ya gotta look at 1) they are an amazing restaurant or 2) they have below mkt rents (tavern on the green) or 3) they own the land/bldg and are subsidizing their food losses with re bubble profits.
Restaurant impOssible ''how much have you put into this place'
A: 'I have a loan against my house!'
You are probably only going to find this to exist with old school restaurants, and in all likelihood they too did not own initially but ultimately bought the building when the opportunity arose (and prices were cheap decades ago). I believe that the people who own Johns of 12th Street own the entire building.
im speaking also of 2 types of restauranteers..
the one who starts off with his 1st restaurant will clearly be leasing because bank wont give him 2 loans (for PP&E, and then another for actual land/bldng, unless part of ineriteratti)..
this q will probly be geared more toward the owner who already has 6-7 restaurants up and running (per the movie mentioned above) and who was the capital needed to purchase.
to add to last, or maybe owner of a sole restaurant who's been up n running over the years and was able to purchase..
Ponte's at West & Desbrosses has owned its land since the 1960s. They've got several other lots in the neighborhood, too.
>Most lifespans of restaurants are 7yrs. anything older than that and ya gotta look at 1) they are an amazing restaurant or 2) they have below mkt rents (tavern on the green) or 3) they own the land/bldg and are subsidizing their food losses with re bubble profits.
It's a 1 in 200 gamble to go past 10 years. Especially in this city, competetion is fierce. Even the long timers open 2nd and 3rd restaurants because because enthusiasm goes stale. A 5 plus 5 lease is good enough, and if you could manage 1 or two more options beyond that, your golden.