Restaurants for Sale in Toronto, Ontario - Page 10

Buying a restaurant means buying a going concern rather than real estate. What changes hands is the business itself: the balance of the lease on the premises, the kitchen equipment and dining room fixtures, the name and the recipes, the trained staff who stay on, and whatever goodwill the room has built with its neighbourhood. The premises are usually leased from a landlord, not owned by the seller, so a restaurant sale is normally an asset sale plus an assignment of that lease, and the price reflects a working kitchen you can open in rather than land you can hold.

Settle the licence first. A liquor licence does not pass automatically with the premises when the business changes hands. Some provinces transfer the existing licence to an approved buyer, and others require a fresh application in the buyer's own name, so establish which route applies where the restaurant is before you agree a closing date. Either route takes time and either can be refused, and that timing is what decides whether you open with a bar or without one. Ask the seller for the current licence details, the capacity it permits, and any compliance history against it.

Then the kitchen itself. The exhaust hood, the make-up air and the fire suppression system all have to satisfy the local fire and building authorities, and a hood that was approved under an older permit can become a capital project the first time you move the cooking line. Ask when the suppression system was last serviced and certified, ask whether the hood as built matches the equipment underneath it, and ask what the landlord and the municipality would require if you changed the cooking method, because a kitchen that suits the current menu may not suit yours.

Then the lease, in writing. Get the remaining term and the renewal options, confirm the landlord will consent to an assignment and what fee or personal guarantee that consent costs, and confirm the use and hours you want are permitted by the lease and the municipality. A short remaining term limits what you can sensibly invest in the space and what the business is worth when you sell it. Then have the chattel list searched for liens: walk-in coolers, ranges, ventilation and point-of-sale terminals are often financed or leased rather than owned, and a registry search under the seller's corporate name shows what is still secured.

The listings on this page are the ones the MLS® feed classifies as restaurants in the city or province you are viewing, refreshed daily. That classification comes from the listing brokerage, so a restaurant filed under a different business category will not appear here and this page does not claim to show every restaurant for sale. Read each listing for whether the premises are leased or owned, since most of these sales convey a business and a lease rather than a building. This overview is general information, not legal, financial, or tax advice.

A business listed for sale is a going concern rather than a property. What changes hands is usually the equipment, the stock on hand, the trading name and customer goodwill, the staff who stay on, and the balance of the lease on the premises. The premises themselves are more often rented from a landlord than owned by the seller, so most of these sales are an asset purchase plus an assignment of that lease.

Where the seller does own the land and the building, the real estate is priced separately from the business and can be bought outright or leased back. Each listing states which of the two it is, so read that before you compare one asking price against another.

Three things decide whether a business can keep trading the day after it changes hands: the licence or registration the operator holds rather than the premises, the landlord's written consent to assign the lease, and a registry search showing which equipment is owned outright and which is still financed. Settle all three before you remove conditions.