Every growing food business eventually asks the same question: should we keep renting kitchen time, or is it time to get our own space? It usually gets decided on feel: the frustration of scheduling around someone else, the appeal of a place with your name on it. That is an expensive way to decide. The honest answer is arithmetic, and for most businesses under a few hundred thousand dollars in revenue the arithmetic is not close.
What building your own kitchen actually costs
The equipment is the part people price out first, and it is rarely the biggest number. Here is the full picture for a modest production kitchen in a Northeast Florida commercial space.
One-time build-out
- Plumbing. A three-compartment sink, a separate handwash sink, a mop sink, floor drains, and a grease interceptor. Running new drain lines through an existing slab is the line item that blows up budgets.
- Electrical. Commercial ovens, mixers, batch freezers, and walk-ins need dedicated circuits and often a service upgrade. A panel upgrade alone can run five figures.
- Ventilation. If you ever want a range or fryer, a Type I hood with make-up air, fire suppression, and roof penetration is one of the single largest costs in any restaurant build-out: commonly tens of thousands of dollars installed.
- Surfaces and finishes. Commercial-rated flooring, coved base, washable wall surfaces, and ceiling that passes inspection.
- Walk-in cooler and freezer. Purchase plus installation, plus the electrical to support them.
- Equipment. Convection ovens, mixers, prep tables, racks, scales, and for beverage or frozen production, a cold-press juicer or batch freezer, each of which can be a five-figure item on its own.
- Permits, plan review, architect and engineering drawings, and impact fees. You will need stamped drawings for the health and building departments. Budget both money and calendar time.
Realistic total for a small, non-hooded production kitchen in a shell space: well into six figures. Even taking over a space that was previously a kitchen (the cheapest possible path) usually means a five-figure refresh plus deferred maintenance you inherit.
Ongoing costs, every month, whether you produce or not
- Rent. Commercial space is quoted per square foot per year, usually triple-net, so on top of base rent you pay your share of taxes, insurance, and common area maintenance. A 1,500 square foot space is a meaningful monthly number before you turn on a light.
- A personal guarantee on a three-to-five year lease. This is the part that quietly matters most. You are personally on the hook for the full term even if the business doesn’t work.
- Utilities. Commercial electric with demand charges, water and sewer, gas, trash and grease hauling.
- Insurance. Property, general and product liability, and business interruption on a facility you now control.
- Maintenance. Hood cleaning, grease trap pumping, refrigeration service, pest control, fire extinguisher inspection, equipment repair. A failed compressor is your problem at 2am.
- Your time. Facility management is a job. It is not the job you started this business to do.
What renting hours costs
Shared commercial kitchens in mid-size markets typically rent production time somewhere in the $20 to $45 per hour range, with monthly memberships that bundle hours at a lower effective rate. Storage is usually a small monthly add-on. At First Coast Commissary, Pay As You Go is $35.00 per hour with no monthly fee: see full pricing.
The structural differences matter more than the rate:
- No build-out cost and no lease. Your capital goes into ingredients, packaging, and marketing: the things that actually grow revenue.
- Costs scale with production. A slow January costs you almost nothing. A slow January in your own lease costs exactly as much as a busy December.
- Someone else owns the maintenance. And the inspections, and the compressor.
- You can start next month. Build-outs take six months to a year between drawings, permitting, construction, and inspection.
Finding your break-even
The comparison is simpler than it looks. Estimate two numbers:
- Your true monthly cost of ownership. Rent plus CAM, utilities, insurance, maintenance reserve, and the monthly amortization of your build-out and equipment over a realistic life. Divide the build-out by 60 months, not 120: equipment and leasehold improvements do not last forever.
- Your monthly rental cost. Production hours per month times your hourly rate, plus storage.
Then ask how many hours per month it would take for rental to exceed ownership. For most small food businesses, the crossover sits somewhere north of full-time, near-daily production, and even then only if your revenue is stable enough to carry the fixed cost through a slow season. If you’re producing two or three days a week, renting wins by a wide margin and it is not close.
The cases where owning genuinely wins
Renting is not always right. Build or lease your own space when:
- You need a range, fryer, or hood. Savory hot-line production requires ventilation that most shared bakery and beverage kitchens (including ours) don’t have. We do not have a commercial range or exhaust hood. The kitchen is not suitable for frying, grilling, wok cooking, or savory hot-line production.
- You need the space around the clock. Continuous or overnight production at volume outgrows scheduled hours.
- Your process needs dedicated, permanent equipment. A custom line, a large-format oven, or an allergen-segregated room.
- You need a retail storefront. If customers come to you, you’re buying frontage, not a kitchen.
- Certification requires exclusive control. Some certifications are difficult to hold in a shared facility.
A quick sanity check before you sign anything
- Have I had twelve consecutive months of production at this volume, or am I projecting?
- Can I carry the full lease payment for six months on cash I already have?
- Do I actually need equipment the shared kitchen doesn’t have, or do I just want my own schedule?
- Who is going to manage the facility, and what will they stop doing to do it?
- What would this capital return if I spent it on marketing, packaging, or sales instead?
If the last question has an obvious answer, you already know what to do. More on structuring your costs in our guides to starting a home bakery and starting a juice or cold brew brand.