Toronto is a popular restaurant destination for tourists, locals and people who live on the outskirts of the city. Purchasing a restaurant here can be a lucrative, as well as a personally fulfilling experience.
At any time in the year you can find many Toronto restaurants for sale. Some are up for sale simply because the owners are retiring; others go on the market because the owner is burned out and ready to move onto to a different venture.
Purchasing a restaurant in Toronto can take up less time and be less work than starting a new restaurant. With an existing restaurant your staff is already established and trained in their positions, there is already a customer base, and if the seller is motivated you can get a good deal.
What to Look For
Toronto is one of the most culturally diverse cities in the world. Well over 50 languages are spoken here on a regular basis. This means that the restaurant industry has a wide range of tastes to appeal to.
When you are interested in buying a Toronto restaurant the first thing you have to ask yourself is, what kind of place do I want to own? There are over 70 different types of cuisine that people can enjoy in the city of Toronto.
You can take your pick of owning a restaurant that specializes in Chinese, Greek, Italian, Russian, French, Canadian, Polish, Japanese, Caribbean, Cuban, Ethiopian; Mexican…the list goes on.
While these various tastes are scattered throughout the city, some communities specialize in a particular cuisine. For instance Toronto has a Chinatown, Greektown and a Little Italy.
If you aren’t interested in being in a small culture based neighborhood then you have many options when it comes to restaurant areas. The Entertainment District is filled with restaurants that appeal to theatre and concert goers.
Owning a restaurant in Toronto’s Entertainment District can be very lucrative. Aside from the downtown core you can consider, Midtown, North End, East End and West End.
There are many different types of restaurants in Toronto, but here are examples of the most common:
- Casual Dining
- Fast Food restaurants
- Luxury Dining
- Private Dining rooms
- Seafood Restaurants
Getting Down to Business
The Toronto commercial real estate industry is big enough that it employs thousands, and some of these professionals are very good at their jobs.
Retaining a seasoned agent to help you get through the purchasing process smoothly is vital. If you don’t have a commercial real estate agent yet you can try the Toronto Real Estate Board’s commercial division.
The organization can assist you in finding a good agent, as well as advise you on what to look at when you visit each business. You can get a sneak peak by logging onto www.trebcommercial.com.
There is another organization in Toronto that will also help those who are hoping to buy a restaurant. It’s called the Building Owners and Managers Association of Toronto (BOMA).
BOMA offers a wide range of information, including real estate regulations, local legislation pertaining to commercial real estate and other helpful tips. You can find them on the web at www.boma.org.
When you are beginning your search for a restaurant, it can be enlightening to take a look at a few online sources, before you actually visit a business in person.
The following websites list restaurants for sale in Toronto and in communities on the outskirts of the city; www.restaurantsales.ca, www.BusinessForSale.com, www.restaurantsforsaletoronto.com.
Both e-bay and Kijiji also have listings for restaurants that are up for sale in the city.
When you visit some online commercial real estate websites you will notice that there is a wide range of prices for restaurants in Toronto. This gives you a lot of opportunity.
There are some restaurants that will cost as little as $70,000, while others will run into the $200,000 range or higher.
One piece of advice your Toronto commercial real estate agent will likely give you is to work a non-compete clause into your contract. This prevents the current owner from opening a similar restaurant in the same neighbourhood for a specified period of time.
The purchase price of a restaurant can be based on something called, “customer retention”. In this case the buyer and the seller sign a contract that states if the business loses a certain percentage of customers within a specified period of time, the purchase price can be reduced.
Commercial agents in Toronto want you to be satisfied with your investment so they offer a lot of good advice. Each time you visit a restaurant for sale in the city, they will urge you to gather all the financial information you can about the business.
They recommend you collect inspection reports, demographic information on customer base, expansion regulation data, present and past menus, as well as information about licenses, contracts and equipment.
When you find the right restaurant, in the right Toronto neighbourhood, you will not only reap the fiscal benefits associated with serving the public, you will meet hundreds of interesting and friendly people.
Totally Toronto can help you connect with the right people, take a look around for more great information.