7 Tips for Finding the Perfect Location

restaurant real estate

The first—and often the hardest—step in opening a new pizzeria involves finding the perfect location. You know the one…tons of foot traffic, ample parking, low rent, lots of natural light, minimal build-out requirements, etc. The process can involve months of searching coupled with innumerable sleepless nights spent ruminating about your seemingly never-ending wish list.

Many first-time pizzeria owners—or even those looking for a second location—sabotage their success by either choosing a location too quickly, or being sospecific about their needs that they’re never able to choose anything. So how do you know for sure that you’re choosing the right space for your new pizzeria? The simple answer is, you don’t. Luckily, there are plenty of people who have been in your shoes before and lived to tell the tale. Here, I’ll share some tips owners have shared with me over the years when it comes to finding the perfect home for your first—or next—pizzeria.

1. Don’t Select a Space Based on Price, Proximity to Your House or Impatience. Before selecting any location, look at demographics, competition, future growth potential and how the location will fit in with your pizzeria’s concept. Consider who will be walking or driving past your shop on a daily basis as well as those who will may be stopping by after visiting neighboring businesses. Location really is everything, in most cases.
2. Don’t Expect to Find Something Overnight. You probably didn’t choose your home from the first batch you looked at, so don’t rush into securing a pizzeria location before weighing all of the factors that go into it.
3. Ask for Help. While many use services such as LoopNet to search for properties, a realtor is often the best option for alerting you to listings as they come onto the market (sometimes even before they’re listed). They can even hook you into the mls system and have listings sent directly to your inbox. A realtor has your best interest in mind since they’ll also make a commission when they find you something that makes you happy. If leasing your space, have a lawyer look over the lease agreement before signing anything (one thing to check for is a capped Triple Net/CAM charge in your lease. If not capped, the landlord can do a multimillion dollar remodel and charge the tenant for it).
4. Weigh Your Buying and Leasing Options. Big-city locations, such as Los Angeles, New York, and Chicago, don’t lend themselves to purchasing a location due to the high cost of real estate. However, in smaller cities and towns, it can be a great investment to own your own building. This won’t be the same for every situation though. In some cases, leasing can provide more flexibility and less responsibility for maintenance. Buying, on the other hand allows you to gain equity and obtain tax breaks not available as a renter.
5. Plan for Unexpected Expenses. When opening a new pizzeria, there will be a lot of expected—and unexpected—expenses, ranging from contractor costs for remodeling, equipment, supplies, staff, and more. Keep in mind that your projected opening date will almost always be off by a few weeks—if not months, costing you additional lease payments and lost earnings. Have enough money in reserve to cover yourself for six months to a year, and keep a detailed list of all expenses.
6. Know the Difference Between Needs and Wants. Each pizzeria owner’s wish list will be slightly different, depending on your offerings, theme and demographics, but there’s usually some crossover when it comes to aspects such as parking; access to major streets; foot traffic; ideal square footage and an affordable lease. Before searching for your location, write a list of realistic needs and wants. Be ready to say no if a space does not meet your requirements. After all, you will likely be in the space for many years to come, and a small annoyance now could quickly turn into a large nuisance later.
7. Know What You Can Afford. Calculate the number you need to hit in order to cover rent and all expenses and still make a profit. Pad the budget for surprises and don’t overspend or you’ll cut into your earnings before you even open the doors.
Are you currently searching for, or recently found, a new location? Tell me about your experience in the comments below.