Planning Build-Out Expenses and Rental Rates For Commercial Kitchens

Part art, part science: Food and beverage preparation can be both an art and a science. Nutrition and taste are important considerations, along with the skill of preparing food and presenting dishes. Although not all chefs aspire to be "performance chefs," most have one thing in common: They need to have the right tools and workspaces to ensure their food ideas can be executed efficiently and according to their specifications.

No Cheap Designs

Commercial kitchens require a high level of expertise. Therefore, we work closely with the chef to create the right equipment and set the menu. Although kitchen designs for chain restaurants may look similar in different markets, the objective of designing and building commercial kitchens is to ensure that the staff can produce high-quality meals under stress.

Prices vary depending on the quality of materials used, customization level, and the number of specialized equipment in the kitchen. The chef's counter is one of the most costly pieces of equipment. Firms like his make it to the specifications of the cooking lines. Sometimes these counters are hidden from view and visible only to employees. In other cases, however, the counter can be visible to the public or accessible to employees so that customers can see the food preparation work or sit at the counter while they dine.

You will find dedicated areas for cooking raw and cooked protein, preparing sauces, warming side dishes, and refrigerating selected items. In addition, digitally-automated chef's counters allow cooks to take orders, time their prep and cooking, and complete multiple orders simultaneously.

Interestingly, modern kitchens are less complicated than in the past. Although the equipment is simple to use, its engineering is extremely complicated. He gave an example of a "combi," or combination oven, allowing three cooking methods on one appliance. Although programming these ovens is easy with an iPad, the engineering behind them is more complicated. A "double-stack," which is two ovens that have six shelves each, can run upwards of $20,000 in price.

Base-building costs and considerations regarding exhaust and fresh air intake are important. These can vary depending on where the kitchen is located inside the building. Kitchens often require more water, sewerage, electricity, and gas capacity than typical retail tenants. Therefore, it is important to have funds available to increase capacity and ensure utilities reach the building.

These customized build-outs can be costly for landlords regarding tenant improvements dollars and any other concessions they might need. In addition, the degree of customization required for the commercial kitchen adds to the landlord's risk. The kitchen may need to be demolished and rebuilt if the restaurant or food concept fails.

Kitchens can also be problematic in appraisals. For example, if real equipment is older than the property, it could be considered obsolete and reduce the asset's overall worth.

Baking in Costs and Timelines

It is difficult to estimate the cost of kitchens because they are so custom-made and can vary in quality and size. The following table shows the range of costs for a typical kitchen measuring 3,000 square feet. These prices vary in quality from poor to excellent to outstanding. He does not include modifications to base buildings for systems like HVAC or construction to accommodate gas, electric, and plumbing.

These figures are for a complete build-out, including equipment fabrication and installation in the Houston and Dallas areas. A kitchen equipped with basic appliances and materials should cost around $350,000, according to these figures. The standard elements are storage shelves and equipment, as well as freezers and refrigerators. They also include ovens, ranges, and warming cabinets: heat lights, and work tables.

A kitchen of high quality will cost upwards of $650,000. Some of the extra items that will increase that cost include installing and adding more specialized equipment, such as a smoker and pizza oven. In addition, additional freezers and refrigerators and customized chef's tables will increase costs, as previously mentioned.

We have designed kitchens that took as much as six months to complete the design stage to start building them. We make minor adjustments for other clients and can have a drawing approved and completed in less than one month. They then prepare submittals showing the dimensions, sides, and overall appearance of an equipment piece. It takes between four and six weeks to build equipment once the specifications have been finalized. We will then need to install the equipment two weeks after the general contractor has been approved.