Buying an Industrial Land

18 posts in this topic

Dear TTers,

 

Hope you are safe and well.

I have an interest to buy a land and start a business (restaurant). What are the points or NO NOs to check, before buying an Industrial Land. ?

Which banks support the finance, if you are not having the complete capital to buy it. 

 

thank you in advance.

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My first step would be talking with the municipality. Are there improvement contributions to be expected (e. g. are they planning to refurbish the sewerage system) , which permits are needed, how many parkings will you need etc.?

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13 hours ago, write2nadeem said:

I have an interest to buy a land and start a business (restaurant). What are the points or NO NOs to check, before buying an Industrial Land. ?

Which banks support the finance, if you are not having the complete capital to buy it.

 

Have you ever run a restaurant before? Have you ever even worked in a restaurant in Germany?

 

I would highly recommend that you start by writing a business plan to determine how much you'll need to finance the land purchase, build then outfit and furnish a restaurant as well as the running costs for the first year. Unless you have substantial collateral, I think you will find it difficult to finance this project (especially in the middle of a pandemic when so many restaurants are closing).

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@engelchen:Yes, we have an equity capital amount set , i want now the capital to buy the land + furnish + kitchen purchase costs + salaries+ restaurant running costs for one year, am writing a business plan in english, but need one in German, Can anyone here help with that ?

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6 hours ago, write2nadeem said:

@engelchen:Yes, we have an equity capital amount set , i want now the capital to buy the land + furnish + kitchen purchase costs + salaries+ restaurant running costs for one year, am writing a business plan in english, but need one in German, Can anyone here help with that ?

 

You can find quite a lot of info on starting a business in Germany in German,  however, there is very little available in English. You should also be aware that in Germany there are many laws and regulations regarding any type of business that serves food and they are also in German. Don't forget to budget for translation services.

 

Your local IHK would be a good place to start.

 

https://www.startercenter.nrw/de/erfolgsgeschichten/interview-anthony-sarpong-anthonys-kitchen

https://gruenderplattform.de/geschaeftsideen/restaurant-eroeffnen

https://www.existenzgruender-jungunternehmer.de/p/gruendung/branchen/gastronomie.html

 

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Depending on how expensive the land is I´d think about initially leasing the land with an option to buy later once you can better assess how your business will thrive - or not. It would probably cost you an "option premium" but would reduce your risk if things don´t develop according to your business plan. There are always risks you can´t anticipate. Think e. g. of a ringroad diverting traffic, municipal regulations affecting your business, competitors opening next door, infrastructure upgrades you´d have to contribute to etc. I once bought a condo and shortly after that an investor bought the neighbouring building and turned it into a refugee home. After that I couldn´t even find a Makler prepared to sell my flat for me and the neighbouring apartment  was auctioned away for € 3500 because there were no bidders other than the bank which initiated the foreclosure.

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the fact that you refer to "industrial" land and not "commercial" land leads me to believe you inherited the money.  if you worked for it, you'd appreciate its worth and do a lot more research other than writing a 'plan'.

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If you deliver, you are really ok during covid.  What you lose in eat-in traffic, you gain back in take-out and deliveries.  Get on Lieferando.  They take a cut but they save you from doing your own ads or flyers.  If you do flyers, you can't just do it once, you have to do it about once a month.

 

One thing you should do is talk to authorities in your are to find out about building requirements, kitchen requirements etc.  You need to talk to gesundheitsamt.  They will be coming regularly to check on your kitchen being clean and they can save you the cost of doing things twice if you ask them about requirements before you build it.  Your town may also have requirements about parking spaces etc.  Ask about that too.

 

As for your staff, they need to be food safe certified, they need to be registered as your employees and you need to keep a log on how many hours they are working each week in case Zollamt comes so they can check that all your staff are making at least minimum wage.  You can get fined if they catch you with an employee who is not registered or you haven't been logging your staff's hours. 

 

It may not be that easy to get a loan from a bank unless you give them collateral but it's easy to get smaller loans or furnishings from breweries whose brand you are selling.  They may however require you to sell a certain amount in order for the loans to remain at low or no interest.

 

 

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It is my understanding that when you get in bed with a brewery, you will be beholden to them for supplying not only beer but all of your water, juices, soda, etc. at a much higher price than you would pay at Metro or a drink market. They get their money back and then some. Unless things have changed since I worked in gastronomy.

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1 minute ago, fraufruit said:

It is my understanding that when you get in bed with a brewery, you will be beholden to them for supplying not only beer but all of your water, juices, soda, etc. at a much higher price than you would pay at Metro or a drink market. They get their money back and then some. Unless things have changed since I worked in gastronomy.

 

I don't think it's all your drinks, just your beer.  A friend of mine who owns a restaurant only buys his beer from the brewery supplier and sometimes if he needs some between deliveries, he may even buy it somewhere else.  On the loan though, he only gets credit for the beer he buys from the supplier.  He actually had an issue where he was not selling as much beer as he was supposed to and the brewery slapped him with a couple of options, either pay off the loan or make a new agreement where his amount of beer he had to sell was lowered but he'd have to start paying interest on the loan.

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Thanks. The 2 restaurant owners I knew and worked for had to buy all their drinks from their breweries. I'm sure there are many kinds of contracts.

 

Buyer beware.

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On 18/10/2020, 17:27:23, catjones said:

the fact that you refer to "industrial" land and not "commercial" land leads me to believe you inherited the money.  if you worked for it, you'd appreciate its worth and do a lot more research other than writing a 'plan'.

In Germany, they dont quote this commercial land but Industrial, so was my text, i have not inherited any money my friend, have slogged as Software programmer, Lead for last 12 years, now finding a way to move out into a business.

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On 18/10/2020, 19:46:04, LeonG said:

If you deliver, you are really ok during covid.  What you lose in eat-in traffic, you gain back in take-out and deliveries.  Get on Lieferando.  They take a cut but they save you from doing your own ads or flyers.  If you do flyers, you can't just do it once, you have to do it about once a month.

 

One thing you should do is talk to authorities in your are to find out about building requirements, kitchen requirements etc.  You need to talk to gesundheitsamt.  They will be coming regularly to check on your kitchen being clean and they can save you the cost of doing things twice if you ask them about requirements before you build it.  Your town may also have requirements about parking spaces etc.  Ask about that too.

 

As for your staff, they need to be food safe certified, they need to be registered as your employees and you need to keep a log on how many hours they are working each week in case Zollamt comes so they can check that all your staff are making at least minimum wage.  You can get fined if they catch you with an employee who is not registered or you haven't been logging your staff's hours. 

 

It may not be that easy to get a loan from a bank unless you give them collateral but it's easy to get smaller loans or furnishings from breweries whose brand you are selling.  They may however require you to sell a certain amount in order for the loans to remain at low or no interest.

 

 

Thank you so much for your valuable advise... :) i got so many information that i can look up and that are helpful. God bless.

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On 18/10/2020, 20:03:15, fraufruit said:

Thanks. The 2 restaurant owners I knew and worked for had to buy all their drinks from their breweries. I'm sure there are many kinds of contracts.

 

Buyer beware.

 

On 18/10/2020, 19:50:09, fraufruit said:

It is my understanding that when you get in bed with a brewery, you will be beholden to them for supplying not only beer but all of your water, juices, soda, etc. at a much higher price than you would pay at Metro or a drink market. They get their money back and then some. Unless things have changed since I worked in gastronomy.

Than you

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On 18/10/2020, 07:09:54, engelchen said:

 

You can find quite a lot of info on starting a business in Germany in German,  however, there is very little available in English. You should also be aware that in Germany there are many laws and regulations regarding any type of business that serves food and they are also in German. Don't forget to budget for translation services.

 

Your local IHK would be a good place to start.

 

https://www.startercenter.nrw/de/erfolgsgeschichten/interview-anthony-sarpong-anthonys-kitchen

https://gruenderplattform.de/geschaeftsideen/restaurant-eroeffnen

https://www.existenzgruender-jungunternehmer.de/p/gruendung/branchen/gastronomie.html

This is very good information, i am looking into it, i live in RLP

 

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