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Realities of Restaurant Real Estateby Ira Spilky UCLA Lecture Spring 2005THE REALITIES OF RESTAURANT REAL ESTATE
• Develop your location/site selection criteria or model as a business plan. • Complete all due diligence including current and detailed demographic reports, traffic studies, parking field plans, and tenant mix. • Verify that all land entitlements, licenses and governmental permits are in place and can be acquired to open your restaurant. Meet with city planning departments to achieve your construction or re-modeling plans. • Make sure your chosen prime location economically pencils with your financial pro-forma. • Analyze restaurant competition and their bottom line performance in your trade area to determine what your estimated market share percentage will be. • Live in the trade area for 7 days and nights to obtain maximum on site information and record accordingly. • Honestly and objectively determine form your research and your gut – “Is there a marriage between the demographic profile of the area and your customer profile”? • Location – Location – Location means visibility, accessibility and positioning your site selection development program. • Operators must create win-win relationship deals with their landlord developers. • Document a detailed paper trail consisting of letters of intent, counters, site submittals, governmental regs, and lease drafts. • Negotiate your deal so that your company does not compromise its cost of fixed overhead – knowing that cost is constant heather your restaurant is open or closed. • Make sure you have an existing company infrastructure in place to forward effectively. • WALK AWAY from a deal that does not make sense for your Company or makes you feel uncomfortable.
Ira Spilky can be reached at 310-558-3241. Email address spilky@mindspring.com. |
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Ira Spilky & Associates tel:
310-558-3241 fax: 310-202-1173 |
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