| Every month, an average of over 90 food | | | | provide a lot of valuable information into the |
| service licenses are issued in every state. That's | | | | business dealings of your prospective tenant. |
| over 4,500 new restaurants going into business | | | | #4. Feasibility study. Has your prospective tenant |
| every month across this country. | | | | had a feasibility study done or is one planned? |
| Do you have a restaurant space that you would | | | | This study will evaluate the chances of success of |
| like to fill with a quality tenant? Certainly there is | | | | the new restaurant venture, by examining the |
| no lack of tenants out there that would be | | | | location and facilities offered (such as: walk in |
| interested in your site, so how do you go about | | | | coolers, delivery doors, restroom facilities, and |
| finding the right tenant? This information was | | | | power availability), concept, competition, niche |
| created specifically for Landlords who want to find | | | | market, financial opportunity, and the overall |
| the right tenant for their property. | | | | viability of the project. This study will give you |
| When a prospective tenant is looking for a | | | | and your tenant the security in knowing that the |
| restaurant space, you as the prospective Landlord | | | | new restaurant may be the right concept in the |
| should know what they're looking for, and in this | | | | right area. If the prospective tenant has not |
| order its; a lease they can afford, a site that fits | | | | considered a study, and you like what you see |
| their concept design wise, visible signage space, | | | | from the Landlord perspective so far, you may |
| and parking. Everything beyond this is secondary. | | | | wish to split the cost of a feasibility study with |
| Yes, the quality of the location is of vital | | | | the tenant, or just pay for it yourself and bill the |
| importance, but the affordability of the site is | | | | prospective tenant back over time. The findings |
| paramount. Armed with this information, you | | | | are hard hitting, and factors that never may have |
| should be able to present a sales package to your | | | | been contemplated may be brought to light. Most |
| prospective tenant in terms that they can | | | | importantly, the Feasibility Study will help identify |
| understand. If you can make the location | | | | and confirm the market niche that your |
| financially easy to get into, that will give your | | | | prospective tenant is seeking to fill. This is of vital |
| prospective tenant the extra cash to commit to | | | | importance both to you and to your prospective |
| the other things related to getting the new | | | | tenant. |
| restaurant off the ground. | | | | #5. Business plan. A restaurant business plan is |
| In order to protect yourself from an unqualified | | | | focused on the menu, and everything revolves |
| tenant, there are many questions that you will | | | | around it, including revenues, expenses, |
| want answers to. Set your expectations with the | | | | equipment, payroll projections and all of the other |
| prospective tenant upon your first initial meeting. | | | | numbers and concepts that will go into a business |
| By doing this and listening closely to the answers, | | | | plan. It is not realistic to think that your |
| you can avoid a lot of potential pain for both of | | | | prospective tenant has a business plan yet, |
| you. | | | | because the location issue is still unresolved, as it |
| Six factors that can help you select the right | | | | the seating count, and so many other variables. |
| tenant: | | | | Want to surprise a quality prospective tenant with |
| #1. Create an interview checklist. You will want to | | | | something great? Offer them a long term lease |
| cover a lot of ground with your new prospective | | | | that includes a business plan that you are willing to |
| tenant, and you'll want to ask relevant questions. | | | | pay for (and of course, include in the lease |
| Depending on your unique situation, you may have | | | | terms). This will set you apart as a caring Landlord |
| legal restrictions placed on your ability to ask | | | | who wants the very best for the tenant. Don't |
| questions, so you will want to review your | | | | you think this would be just the thing to close the |
| interview game plan with your legal advisor. This | | | | deal? Think about how few Landlords are including |
| information is meant to be informative only and is | | | | a business plan with an executed lease, and you |
| not to be considered legal or accounting advice. | | | | could end up being the Landlord of choice! One of |
| #2. Credit worthiness. Let the prospective tenant | | | | the nice hidden factors in this equation is that as |
| know that you care about their prompt payment | | | | you have commissioned the business plan as the |
| history, and that you will expect them to | | | | Landlord; don't you now have the ability to give |
| personally be on the lease. Few restaurateurs will | | | | your input into the concept as a whole? Now, you |
| want to personally sign a lease, and it will be | | | | are not only the Landlord, you have become |
| important to deal with this matter right up front. | | | | somewhat of an informal business partner, |
| If the prospective tenant knows that their | | | | allowing you a good view of what's happening in |
| personal creditworthiness is of importance to you, | | | | your space without being surprised. |
| you'll cut right to the chase every time. Are you | | | | #6. Business team. A restaurant management |
| as a Landlord willing to lease to a company with | | | | team not only consists of the owner(s) and the |
| little or no operating history? Perhaps if you have | | | | managers, it's those outside the day-to-day |
| a space that has been vacant for a while you'd | | | | operation that provide advice, direction and |
| consider it, but you will want a significant amount | | | | counsel that play very key roles in the success of |
| of financial security up front. | | | | the new restaurant. Legal, accounting, and |
| #3. Background check. There's an old saying that | | | | restaurant consultant all play unique roles and |
| goes something like this, "What has happened in | | | | contribute to the profitability of the operation. |
| the past is indicative of what may happen in the | | | | Regardless of the experience of the prospective |
| future". Your prospective tenant may have a | | | | tenant, this team should be in place in the very |
| background that may not be spotless. Only you | | | | early stages, and by the time this person is ready |
| can be the judge of what you are willing to | | | | to start looking for space, it should be a red flag |
| tolerate-but don't forget that old saying. | | | | to you as the Landlord if this team is not |
| Background checks are inexpensive and can | | | | together yet. |