What is the Difference Between a First- and Second-Generation Restaurant Space?

In restaurant construction, the terms “first generation” and “second generation” refer to the condition and status of the space, specifically as it relates to the space’s previous use and readiness for a new restaurant tenant.

A first-generation space has never been occupied or used as a restaurant before. It is a blank canvas with no existing restaurant infrastructure or equipment. A second-generation restaurant, on the other hand, is one that was previously occupied and used as a restaurant. For restaurant owners looking at potential spaces, a second-generation location can offer some benefits in terms of potential cost and time savings since there is already infrastructure in place.

Below are some additional differences and considerations to keep in mind when evaluating these two types of spaces for a South Florida restaurant project.

First-Generation Restaurant Space Considerations

First-gen spaces are typically gray shells. They’re either part of a new construction or are in a space that has undergone a complete renovation and has been stripped down to the bones. While utilities will be there to tie into, there are no restaurant-specific systems in place such as grease traps or vent hoods.

These raw conditions can be advantageous for tenants who want to completely customize their space. First-generation restaurants offer more flexibility in terms of creating a layout and design that fits your operational goals. The disadvantages, however, are that they usually require a larger upfront investment to install all necessary restaurant infrastructure and equipment. It also means there can be a longer timeline for construction since everything is being built new.

Second-Generation Restaurant Space Considerations

There are a few advantages to leasing a second-generation restaurant space depending on your goals and priorities. For one, they tend to come with lower initial costs and shorter construction timelines compared to first-generation spaces since much of the necessary restaurant infrastructure is already in place. Additionally, there can be cost savings on kitchen equipment if it is already present and functional.

On the flip side, the challenge is that second-gen spaces can be very limiting in terms of layout and design. Some owners end up undergoing significant renovations to achieve their goals and, at the end of the day, may have been better off going with a first-gen space.

Contact us at Seacoast Consulting Group

As you evaluate restaurant leasing options in Miami-Dade, come talk to us at Seacoast Consulting Group. Our goal is to help clients mitigate costs and keep their timelines on track by proactively managing potential obstacles with their builds. We can help you evaluate whether a first- or second-generation space is better for achieving your needs.

To learn more about how we can help you and to set up a free consultation, get in touch with our team at Seacoast Consulting Group.


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