This document discusses budgeting considerations for building out a new food business. It provides average buildout costs per square foot and per seat for different types of restaurants. Fast food averages $63 per square foot and $3,250 per seat, while full service averages $198 per square foot and $5,576 per seat. Leasehold improvements typically account for 45-60% of costs, with furnishings and equipment at 30-40% and other costs making up the remainder. Construction costs can vary widely from under $50,000 for an existing restaurant to over $500,000 for a new concept. Soft costs like permits and professional fees should also be budgeted.

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BASICS OF FOOD FACILITY DESIGN: MODULE 5
BUDGETING YOUR BUILDOUT

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HOW MUCH DOES A FOOD BUSINESS COST TO BUILD?

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BENCHMARKING AGAINST SIMILAR OPERATIONS
Type of Restaurant
Average Buildout Cost
per Square Foot:
Average Buildout Cost
per Seat:
Fast Food $63 $3,250
Fast Casual $158 $1,866
Full service $198 $5,576
Data Source: Restaurant Startup and Growth Magazine

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BENCHMARKING AGAINST SIMILAR OPERATIONS
Type of Space
Average Buildout Cost
per Square Foot
Average Buildout Cost
per Seat
Existing restaurant
being renovated
$85 $2,222
Completely new
restaurant
$242 $6,790
Data Source: Restaurant Startup and Growth Magazine

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WHERE COSTS TYPICALLY FALL
• Leasehold improvements: 45 - 60% of total
buildout budget
• Furnishing & equipment: 30 – 40%
• Opening costs: 5- 8%
• Contingency & Fees: 10 – 15%

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LEASEHOLD IMPROVEMENTS
Most costly
(usually)
Least costly
(usually)
Ventilation changes
Major structural changes
Widen windows/doors
Plumbing changes
Electrical
upgrades
Lighting and finishes

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YOUR BUDGET
Construction Costs
+
FF&E Costs
+
“Soft” costs
Total Build-out Budget

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CONSTRUCTION COSTS
• Vary widely depending on project
– Taking over existing restaurant with minimal changes can be
under $50,000
– Taking over existing space that is not currently a restaurant can
range from $100,000 to $500,000+, depending on concept and
needs
• Landlord Contribution
(also called Tenant Improvement or “TI” money)
– Minimal for first-timers
– Assume no more than 10% of construction cost initially

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FF&E COSTS
• Front of house: Anywhere from
$50 - $500 per SF (or more!)
– Chairs: About $100 each minimum
(have 5-10 extra)
– Tables: Minimum $250 each
– Millwork: Minimum $200-300 per
linear foot
• Back of house: Anywhere from
$100 to $300 per SF
– Hoods: About $1,000 per linear foot
(excludes ductwork)
– Avoid custom stainless steel
fabrication work if you can

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SOFT COSTS
• Design Professional Fees
• Building permit
– Generally needed for any work
exceeding $1,000 in value
– Takes 1-12 weeks to obtain
(sometimes more!)
• Sign permit
• Utility tie-in permit
• Fire certificate/certificate of
occupancy and maybe more!
– check local requirements

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DO YOU NEED TO HIRE A DESIGN PROFESSIONAL?
• You’ll need a licensed architect if:
– You are changing anything structural (load
bearing walls, exterior doors or windows,
stairs)
• You’ll need an engineer if:
– You are adding or changing a hood
– You are adding or changing significant
building system elements
• Design Professional Fees: Estimated at
10% of your construction budget or
around $25,000, whichever is higher

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