June 14, 2026 Hospitality & Accommodation

Commercial Mortgages for a Restaurant, Explained

Buying the premises your restaurant, bistro or fine dining room trades from is a defining step, and it protects the kitchen, extraction and front-of-house you have already built. At Ardent Capital Group we speak with hospitality owners about this kind of commercial property purchase, and this guide walks through how a lender sees it.

Ardent Capital Group arranges commercial mortgages for restaurant, bistro and fine dining operators across Australia. Our team helps you move from tenant to owner and gives you clear advice on structure and strategy, so the finance supports the business you are building.

Funding range: Ardent can help you access finance of $100,000 to $10,000,000+.
Track record: We have helped facilitate over $500,000,000 in funding across a decade for more than 1,000 borrowers.
Coverage: We service Sydney, Melbourne, Brisbane, Perth, Adelaide, Canberra, Hobart and surrounding regional towns.
Panel and structures: Bank and non-bank options for owner-occupiers and investors, arranged to suit hospitality cash flow and security.

Owning vs leasing your restaurant

Fit-out spend is real and often unrecoverable if you move. A compliant commercial kitchen, extraction, grease trap, cool rooms, three-phase power, acoustic treatment, bar systems and fire services can run to six or seven figures. Ownership protects that outlay and makes long-term refurbishment a business decision rather than a landlord negotiation.

Location anchors your customer base. Neighbourhood dining routes, CBD lunch trade, theatre precincts and destination venues are tied to address, footfall and approvals. Ownership secures trading continuity, signage rights and the ability to obtain or upgrade outdoor dining approvals and penetrations for extraction.

The sector is resilient. Quality operators shift menu mix, price points and service models to suit demand. Repayments build equity, and any future sale of the freehold can realise value separate to the brand.

Key drivers for ownership:

Protect sunk fit-out: Keep the value of kitchens, exhaust and front-of-house in a premises you control.
Control occupancy cost: Replace rent escalations with loan repayments and a clear amortisation path.
Secure approvals and hours: Maintain liquor licence conditions, extraction penetrations and outdoor dining where council permits allow.
Create optionality: Hold the freehold, sell or franchise the brand later, or add income if the site has multiple lettable areas.

Ownership suits some operators more than others. If you expect to relocate soon, your lease horizon is short, or your capital is better directed into a second site or your team right now, leasing may serve you well for the moment. When you are ready to hold the premises for the long term, that is where we help, and a restaurant property loan is something our hospitality desk structures around how a lender reads a food and beverage freehold.

What a restaurant commercial mortgage looks like

Deposit and LVR. For a restaurant, bistro or fine dining freehold, loan-to-value ratios typically sit around 60 to 70 per cent, so plan for a 30 to 40 per cent deposit. A restaurant premises gears higher than a pub because there is little or no licence or gaming value to discount, and the building reads as a more conventional retail and commercial asset. If you are buying the business and fit-out on a leasehold basis rather than the freehold, expect 40 to 50 per cent, with the loan term capped by the remaining lease. Where you can offer additional security, our broker team can walk through how that changes the gearing.

Loan term and structure. Terms typically run 15 to 25 years depending on the lender, with banks at the shorter end and non-banks extending further. You can structure principal and interest for steady amortisation, or interest only for a period if cash flow prioritises refurbishment, seasonal swings or a ramp-up plan.

Security and serviceability. The property is the primary security. Lenders assess serviceability using business financials, typically two to three years of accounts and BAS, with normal add-backs and a view on wages, cost of goods, delivery platform fees and occupancy costs. Some lenders accept secondary security over other property or limited guarantees from directors.

Owner-occupier treatment. Lenders generally favour an owner-occupier restaurant purchase over a pure investment, given trading control, stronger alignment and lower vacancy risk. Nick and the Ardent Capital Group team draw on a financial planning background to shape the right structure with you, then hand the tax and reporting detail to your accountant to confirm.

Common ways to hold the property

The way the freehold is held shapes the loan, the guarantees and how the trade income services the debt. Restaurant, bistro and fine dining operators already use a handful of common ownership arrangements, and a lender reads each one differently, so it helps to know how the finance is arranged around the set-up you have.

Holding entity leasing to the trading business: Many operators hold the freehold in a separate company or discretionary trust that leases the premises to the trading entity at a commercial rent. That rent becomes the serviceability line the lender underwrites, it keeps the fit-out and property value apart from the operating risk of the kitchen, and it lets you sell the restaurant business one day without selling the building.
Holding and operating company split: Property in one company, the venue in another. Lenders read this well because the security sits in a clean entity while the trade, with its wage load and thin margins, sits in the operating company. Directors' guarantees usually still apply across both.
Multiple trusts, beneficiary and unit ownership: Where partners or family share the venue, a unit trust can set fixed ownership proportions over the freehold while a discretionary trust runs the trade. The lender will want to see who controls each entity and who stands behind the loan, since the fit-out and liquor licence value flow through those beneficiary and unit holdings.
SMSF with a bare (custodian) trust: If the premises qualify as business real property, an SMSF can hold the freehold through a bare trust under a limited recourse borrowing arrangement and lease it back to the restaurant at market rent. LVRs are lower inside super, personal guarantees are still required, and the fund needs a liquidity buffer, because a specialised food and beverage premises with a heavy fit-out is valued conservatively.

Ardent arranges and structures the finance around your set-up; your accountant confirms the tax, super and ownership detail before anything is locked in. We describe how these structures sit with a lender, not whether one is right for your fund.

How your application is assessed

Business financials: Two to three years of P&L, balance sheets and BAS, plus year-to-date results, POS summaries and evidence of covers, bookings and function revenue where useful.
Serviceability and cash flow: Historical and forward trading, normal add-backs, interest coverage, and how rent will be replaced with inter-entity rent and loan repayments.
Property and valuation: Land value, frontage, visibility, exhaust and grease trap capacity, cool rooms, compliance with fire and health codes, and scarcity in the dining precinct. The valuer treats a restaurant mostly as a retail and commercial premises, with the trade supporting serviceability rather than lifting the valuation, and the fit-out valued well below what it cost to build because it is largely non-transferable.
Deposit and equity position: Cash on hand, retained profits, or the ability to leverage your equity in residential or other commercial property.
Lease and occupancy: A market rent lease from the holding entity to the trading entity, and any existing third-party tenants if the freehold is mixed-use or multi-tenant.
Experience and management: Operator track record, continuity of key team members and a realistic refurbishment and trading plan.
Licences and approvals: Liquor licence status and council approvals for use, extraction and outdoor dining.

A specialist broker who understands hospitality can frame these elements in a way that aligns with credit policy in this sector.

How this might look in practice

This is an illustrative scenario that shows the kind of situation we can assist with, and how the thinking might run. A chef-owner duo run an 80-seat neighbourhood bistro turning over $2,800,000, with consistent bookings and function trade. Their lease has four years left with 4 per cent annual increases, and the landlord lists the strata freehold for sale at $1,650,000. Three paths would be worth mapping:

Buy the strata freehold as owner-occupier: Target LVR around 65 to 70 per cent, so a deposit of roughly $495,000 to $577,500 from cash and by choosing to leverage your equity in the family home. The owner would structure principal and interest over 20 years, with a short interest only period during kitchen upgrades. Upon settlement the holding company leases to the trading entity at market rent, which aligns serviceability.
Buy a larger mixed-use freehold nearby at $3,200,000: Two retail tenancies plus two apartments. Gearing up to around 70 per cent subject to valuation and the tenancy mix, with a higher deposit partly from equity release across existing property. Diversified rent supports serviceability, and the restaurant secures a long head lease.
Buy a smaller $1,200,000 strata through an SMSF: A lower LVR and different contribution rules apply inside super, with the lease set at market rent and the long-term ownership objective prioritised over gearing.

How we would approach it: we would map the deposit sources, lending ranges and repayments across each path, including the likely lending available upon settlement, and the choice would stay with the owners. The figures above are illustrative, not confirmed outcomes.

Finance types for restaurant owners

Asset finance for kitchen and bar equipment: Finance for combi ovens, cooklines, refrigeration, dishwashers, espresso machines, POS, exhaust fans and beverage systems sized to your service volume.
Fit-out and refurbishment finance: Funding for extraction upgrades, grease trap, epoxy flooring, acoustic treatment, lighting, banquette seating and facade works timed around a shutdown plan.
Working capital loans: Short-term cash flow support for seasonality, outdoor dining fit-out, menu changeovers and supplier prepayments.
Business overdraft: Flexible limit linked to trading to smooth weekly wage runs and supplier cycles.
Refinancing and debt consolidation: Consolidate multiple facilities into a single structure to simplify cash flow and strengthen serviceability.
Construction and renovation: For knock-throughs, cool room builds, power upgrades and compliance works aligned with DA or CDC conditions.
Business or premises acquisition finance: Buy a second venue, acquire the freehold you trade from, or buy out a partner with a structure that protects trading.

Owning the premises can reduce rent exposure and create equity that works alongside restaurant equipment finance and working capital for a restaurant in a coordinated plan.

A broker who knows restaurant property

Ardent Capital Group arranges commercial mortgages for restaurant, bistro and fine dining operators and structures finance around how you intend to hold and occupy the property. We handle owner-occupier and investment scenarios and align the loan to your venue plan.

We service Sydney, Melbourne, Brisbane, Gold Coast, Perth, Adelaide, Canberra and surrounding metro and regional areas.

Ardent Capital Group is a specialist in commercial mortgages and our team can help you today. Talk to us about your venue, your property target and how to position for optimal financial outcomes. We have helped facilitate over $500,000,000 in funding across a decade for more than 1,000 borrowers.

Your questions answered

What deposit do I need to buy my restaurant premises? For a restaurant, bistro or fine dining freehold, LVRs typically sit around 60 to 70 per cent, so plan for a 30 to 40 per cent deposit. A leasehold business purchase sits nearer 40 to 50 per cent, with the loan term shaped by the remaining lease.

Can I use equity in my home to help with the deposit? Yes, many owners choose to leverage your equity in residential or other commercial property to reduce the cash deposit or support stronger terms.

How do lenders assess serviceability for a restaurant or bistro? They review two to three years of financials, BAS and year-to-date trading, look at margins and wage costs, and model how rent will convert to inter-entity rent plus loan repayments.

Is an SMSF allowed to buy my venue's freehold and lease it to the business? Often yes. If the property qualifies as business real property the SMSF can own it through a bare trust and lease it back at market rent, subject to SMSF rules and lender criteria. Your accountant confirms the fund detail.

Can I get interest only to manage a refurbishment? Some lenders allow an interest only period to support fit-out or a relaunch, then switch to principal and interest for amortisation.

What property types score better with lenders in hospitality? Prime strip or corner sites with strong land value, compliant extraction and services, and mixed-use freeholds with diversified income usually test well on valuation.

Does liquor licence or outdoor dining approval matter to a lender? Yes, current licences and council approvals support trading continuity and can be factored into the credit view, especially for owner-occupiers.

Written by

Nick Chong

Managing Director, M.AppFin, Dip. Mortgage Mgmt

Nick holds a Bachelor of Agricultural Economics, a Master of Applied Finance and an Advanced Diploma in Financial Planning. He founded Ardent Capital in 2016 after more than a decade in financial planning and mortgage broking. For the past ten years he has led a team of finance specialists, mortgage advisers, brokers and credit analysts, all working to secure optimal outcomes for clients and always acting in their best interests. The team brings both a qualitative and a quantitative approach to every deal.