- Small but growing towns can be worth considering over major metro area restaurant locations.
- Negotiate the right of first refusal if your landlord decides to sell the property.
- Make sure it is clear in your lease what maintenance will be paid for by the landlord and what you are responsible to keep maintained.
How to find the best pizzeria location and protect your business
As co-owner of Cascadia Pizza Co., which boasts eight stores and is has begun expanding outside its home market in the Northwest U.S., attorney Thomas Reinhard has evaluated, negotiated and signed his share of commercial lease agreements.
During a seminar at Pizza Expo 2026, the pizzeria’s CFO and general counsel shares what business owners should consider when finding a commercial property to lease and what parts of the agreement they should negotiate.
How to Find Restaurant Real Estate
Reinhard emphasizes that finding a local real estate expert is better than trying to do research yourself. For one thing, commercial real estate professionals often hear rumblings about tenants that might leaving and have personal relationships with property managers that offer the inside scoop.
He advises looking at leasable space with a smaller footprint – especially if there is outdoor space where pizzerias can add patio seating that is not included in the landlord’s quoted price per square foot.
Reinhard adds that second-generation restaurant spaces can save operators money, since they won’t have to spend as much on tenant improvements. “It can come with some hiccups, but you’re not spending the money on moving electrical or plumbing around. A lot of times, they’re leaving their fixtures, like hand-wash sinks and the more critical things.”
That said, he advises potential tenants to do some research about a restaurant is not renewing its lease, adding that review sites can help decipher whether the restaurant failed due to bad service or a difficult location. He advises clients to seek out spaces that offer:
- Right-hand turn access.
- Ample parking.
- Tenant synergy (no direct competitors, but busy shopping areas).
- Good opportunities for signage.
- An end-cap location (more likely to have room for outdoor seating).
Advantages of Smaller Communities
The attorney advises potential business owners not to overlook growing towns with between 10,000 and 25,000 residents. Bigger operators might be using location data that is a few years old, but new apartment or condo buildings mean new customers.
As an example, he points to a Cascadia Pizza location in Rathdrum, Idaho, which has a population of 12,000 and does great sales for the small pizzeria chain. “The community has just flocked to the pizzeria because finally they have good food,” he says, adding that previously Rathdrum had just a handful of restaurants – most of them serving fast food. “Finding some of these small, up-and-coming areas where we know folks are moving … they’re excited to have something in their community.”
Lease Considerations
Zoning should be one of the top priorities for those looking to open a pizzeria location. Reinhard says he writes a clause into every lease saying the deal is contingent on permitting, meaning the pizzeria can get necessary permits for tenant improvements, a liquor license, etc.
“If you don’t have this permitting contingency in there, all the power is in the landlord’s hands,” he says.
Reinhard advocates for potential tenants to negotiate a right to purchase the property (or at least a right of first refusal), if the landlord decides to sell. “It can be really important to protect yourselves,” he says of spending the money to start a business in one location, only to have that property sold.
Total Payment
While the monthly rent number is a key consideration, that is not all tenants will pay, Reinhard says. Triple-net leases cover taxes, insurance and maintenance. Reinhard says most leases are triple net, and they often come with a longer rental period and lower base rent – although that increases over time as property taxes and insurance premiums rise.
“If you’re in an older building that might have a lot of maintenance, most of that is not being paid for by the landlord. You’re paying for either directly or through triple nets,” Reinhard says.
It is important to clearly define repair and maintenance clauses in a multi-tenant building at the outset of lease discussions, with HVAC maintenance often being the costliest issue. Reinhard says landlords rarely budge on having tenants assume responsibility for HVAC maintenance, with quarterly maintenance being standard.
He advises potential tenants to push back on being responsible for the subfloor, walls and roof, because the landlord is more knowledgeable about the condition of the building than incoming tenants.
Common Area Maintenance
Lease-holders in multi-tenant locations pay common area maintenance (CAM) fees that can cover items such as landscaping, snow removal and trash service. These fees are based on your square footage relative to the total and are critical to negotiate upfront, he says.
For his part, Reinhard likes to add a cap to how much CAM fees can increase each year, suggesting a 5%-7% is a reasonable number. He also says some landlords ask pizzerias to have their own dumpster, since restaurants produce more trash than typical retail locations.
Important Lease Clauses
Reinhard says there are four key clauses to look for in a commercial real estate lease. These include:
Termination Clause: Conditions for ending the lease early, including penalties, timelines and requirements.
Assignment Clause: Governs your ability to find a new tenant in the event you want to terminate your lease.
Subrogation Clause: The “waiver of subrogation” concerns the liability between tenant and landlord in the event of major damage or loss (typically tied to insurance coverage).
Exclusivity Clause: Restricts landlord from renting to overly similar businesses (example: no more than 30% of another restaurant’s business can come from pizza).
Tenants should negotiate the ability to terminate the lease with as little penalty as possible, Reinhard says, such as a flat fee rather than percentage of business lost.
For the assignment clause, he likes to include that “consent cannot be unreasonably withheld,” or that landlords cannot turn down qualified applicants with strong financials.
When to Walk Away
When it comes to specifics such as the subrogation clause, Reinhard advises pizzerias that they “always want to negotiate with the worst-case scenario in mind.” But there are times when it becomes apparent the landlord is not operating in good faith.
“If you’ve got an LOI executed … and they’re intentionally not putting those (agreed upon) terms in … that’s a bad-faith negotiation,” he says. “I would not be happy, and I’d consider walking from it.”
