What are the best Financing options for a Commercial Real Estate

[Omar Jimenez]

The biggest chapter of my life to date is just about to begin. In early negotiations to acquire a commercial real estate building with successful restaurant operation. I live in the area and know the building and the restaurant that has been operated by the owners of the building since they purchased it. My family own a competing restaurant in the area for the past 15+ years, so I have always kept an eye on the business with the dream to take it over one day and make it what it really should be.

Recently, I approached the owners to try and do a management agreement deal, but after our second meeting, the owners expressed interest to sell the full business and real estate.

The restaurant currently does over $2.5 million a year revenue, the building is worth anywhere from $5-8 million. The real estate is located on an extremely busy corner of a prime avenue with a huge parking lot right across the street, the immediate area has a lot of hot real estate deals taking place at the moment, there will be a complete transformation to this area with investment and new business in the next 5 years. This real estate is located inside the recently established city community Redevelopment agency boundary. Meaning lots of more upgrades and developments are planned and approved coming to this area.

I want to own the real estate and run the business to expand our existing profitable restaurant operations in the area, our current restaurant model is actually the same theme as the one currently here, so it would be an easy transition over to the new management and name, with the long term view to possibly redevelop the building into a multi level building years down the line.

The business has not been managed effectively over the past number of years and has room for at least 30% growth in revenue immediately and upon takeover.

With our hospitality experience in this area managing and operating successful food and beverage operations, we have the recipe for success to operate this new location, where the limitations placed on us by our currently outgrown restaurant will be satisfied with more indoor and outdoor space, a larger capacity kitchen indoors and a new kitchen on the terrace to keep up to pace with our restaurants customer demands. This together with other planned upgrades will make this a $3.2+ million revenue restaurant.

At 35, I come from humble, family operated restaurant business background since I was 12. We have 0 debt and always been frightened with every cent in our operation, that has been one of the keys to our long term success. The restaurant has always been my parents baby as they started it, but my talent has grown the business to unreal new highs over the past 7-10 years. Now I want to continue my parents legacy and do this one all on my own, this will be my legacy business I create for my children. Going into this process knowing I will soon require millions in financing is slightly daunting but extremely exciting.

 I greatly appreciate Any thoughts and advice.