The Market For Selling
Restaurants
Restaurant Realty Company is extremely active and
this year we have been as busy or busier than past
years. A lot of this action is attributed to the
excellent diversified inventory of businesses we
have for sale including businesses with real estate,
franchises, cash flow businesses and well priced
assets for sale businesses. Another major reason we
are busy is that there is a strong buyer pool which
is discussed below.
The
major reasons sellers are selling today is as
follows:
a. Retirement –
Sellers are reaching the age of retirement and are
burned out and tired of all the hassles of running a
business.
b. Relocation – Some sellers are leaving the
area as it is too expensive to live here and they
can’t afford the quality of life they desire.
c. Sellers in Trouble – Unfortunately there
is a high failure rate in the industry and during
challenging economic times there is even a greater
percentage of sellers that fail.
D. Partnership Disputes – We are seeing more
and more successful businesses that are closing or
selling as a result of partner disagreements on how
the business should operate.
E. Career Changes – A number of sellers are
changing careers as they don’t like the business due
to the physical demands which negatively impact
their home life and overall happiness.
The Market For Buying
Restaurants
There is a strong buyer pool as a result of the
following:
1) the high
unemployment rate due to corporate layoffs and
downsizing;
2) the large number of foreigners that want to get
into this business because this an easier entry
business opportunity compared to more complex
businesses;
3) buyers want to put their whole family to work in
the business;
4) people want be their own boss;
5) buyers want to express their creativity and
6) some talented chefs are being financed by
investors who like their food
Most all of
our transactions are all cash transactions and the
serious buyers seem to have plenty of cash as a
result of credit lines from their homes, money they
have pulled out of the stock market, retirement
money for those baby boomers that were asked to take
early retirement, savings and other sources.
There are a
high percentage of buyers that are looking for
businesses that generate cash flow so if you own a
business that falls in this category there is a big
demand for this type of business assuming the
business is reasonably priced. There are a number of
buyers that are looking for businesses with real
estate as they want to build equity rather than pay
rent and some of these buyers are coming out of 1031
tax deferred exchanges from selling other pieces of
real estate. There are a number of buyers that have
their own concept and are looking for a well located
restaurant with a good lease that they can change
with a modest cosmetic remodel.
Why don’t you join the
over 600 satisfied Restaurant Realty Company sellers
and buyers to use our services to help you locate a
business to purchase or help you sell your business
at the maximum price on a confidential basis, if
desired?
Restaurateurs of the Quarter -
Man J. Kim Of Lori’s Diner Purchases Sears Fine
Foods
Restaurant Realty Company
recently participated in selling Sears Fine Foods, a
68 year old San Francisco Institution to Man J. Kim,
a successful restaurateur. Man J. started his
restaurant career with Al’s Country Steakburger as a
night manager while he was attending the University
of San Francisco. Since then he has owned over 24
restaurants and currently owns in San Francisco 5
Lori’s Diners, a 50’s style diner, and a Japanese
restaurant. In addition he has under construction
the Sears remodel and 2 additional Lori’s Diners in
the North and South Terminals of the SF Airport. Man
J. helps small businessmen get started in business
in addition to planning to expand his restaurant
empire to other airports in the county.
Man J. is
totally remodeling Sears, restoring its original
Victorian turn of the century motif which will
reopen in June. The new Sears will expand its
breakfast and lunch format to include dinner
featuring fresh local seafood and operating daily
from 6:30am to 10pm.
Sears was
founded in 1938 by Hilbur and Ben Sears. Ben, a
retired circus clown, built a reputation for serving
Swedish pancakes made from a recipe inherited from
his wife’s Swedish family. By the early 50’s, Sears
was purchased by Mrs. Quita Benner who kept the name
and menu in tact. Her son-in-law, Al Boyajian moved
the restaurant from its original spot on the 500
block of Powell Street to 439 Powell Street, a
larger facility which they purchased in 1964.
We send best
wishes to Man J Kim for continued success and in
carrying on the Sears tradition of producing 11,000
little pancakes a day.
