Buying a Restaurant or Food-Service Business With Commercial Property in Alberta

1. Define the transaction and operating concept

Identify whether the proposal is a share purchase, asset purchase, real-property purchase, lease assignment or coordinated combination. Schedule the legal entities, trade names, intellectual property, recipes, inventory, equipment, contracts, digital accounts, deposits, gift cards, staff and excluded assets.

Describe the buyer's intended menu, service model, seating, alcohol, hours, entertainment, patio, catering, delivery and production activities. A buyer changing the concept may change the municipal, building, fire, health, wastewater and liquor review even at an operating restaurant.

• Shares or assets
• Owned or leased premises
• Menu and service model
• Food and liquor approvals
• Equipment and inventory
• Closing continuity

2. Build a buyer-specific approval path

AHS states that a Food Handling Permit is not transferable when an existing food establishment is purchased and directs a new owner to apply before takeover; an approval inspection is required before operating. Edmonton also states that a change in ownership or legal entity requires a new business licence.

If liquor is sold or supplied, confirm the applicable AGLC application and approval path. The AGLC handbook states that a liquor licence cannot simply be sold, assigned or transferred. The seller's current permits and licences are evidence about the seller's operation—not buyer approval or automatic continuity.

3. Rebuild revenue from source records

Export point-of-sale sales by day, channel, location, product, discount, void, refund, tax, tip and payment method. Reconcile reported sales to merchant settlements, delivery-platform statements, bank deposits, GST records and the general ledger for periods selected with the buyer's accountant.

Gross sales are not gross profit, discretionary earnings or collected cash. Separate dine-in, takeout, catering, delivery, liquor, gift-card issuance and gift-card redemption, and identify owner or related-party transactions instead of annualizing an unverified run rate.

4. Rebuild cost of sales, labour and normalized earnings

Reconcile purchases, inventory counts, waste, spoilage, discounts, comps and recipe or menu costing to reported food and beverage cost. Review payroll registers, schedules, tips, vacation, remittances, benefits, overtime, contractor arrangements and owner labour with employment and accounting advisors.

A menu price increase is not proof of sustainable margin, and unpaid owner hours are not free labour. Present reported results, documented adjustments and buyer forecasts separately, with each adjustment tied to evidence and responsibility for tax or employment interpretation assigned to qualified advisors.

5. Verify the lease or real-property rights

For leased premises, review every lease, amendment, renewal, guarantee, inducement, default, use clause, exclusivity, assignment and change-of-control provision with counsel. Confirm base rent, additional rent, percentage rent, utilities, patio, storage, parking, signage, roof and delivery rights.

For owned property, investigate title, permitted use, building condition, environmental matters, tax, utilities and capital needs separately from the operating business. A successful restaurant does not prove that the lease can be assigned, the option can be exercised or the property value equals the business asking price.

6. Prove kitchen, fire, ventilation and utility capacity

Inventory hoods, exhaust ducts, make-up air, fire suppression, gas, electrical service, hot water, refrigeration, plumbing, interceptors and roof penetrations. Obtain permits, approved plans, service records, inspections and professional assessments appropriate to the proposed menu and equipment.

Calgary notes that approvals for a new owner can differ from those of the previous restaurant and that upgrades may be required even without planned construction. An installed hood, suppression tag or working appliance is not proof of permit status, code compliance, capacity or suitability for the buyer's cooking line.

7. Trace grease, wastewater, waste and pest controls

Map every sink, dishwasher, floor drain, mop sink, grease interceptor, used-oil container, waste area and sewer connection. Review sizing, plumbing permits, service frequency, logs, backups, complaints, pest-control records and responsibility under the lease.

Calgary and EPCOR publish binding or bylaw-linked grease-control requirements for food-service facilities. A recently cleaned interceptor is not proof that it is properly sized, legally installed, connected to every required fixture or adequate for a changed menu.

8. Establish equipment ownership and condition

Create an equipment register with description, serial number, legal owner, purchase or lease record, lien status, age, condition, maintenance, included status and removal rights. Distinguish landlord equipment, leased or financed systems, supplier-loaned items and seller-owned assets.

Order appropriate Personal Property Registry searches and have counsel interpret registrations and discharge requirements. Equipment located in the premises is not necessarily owned by the seller, lien-free, permitted, serviceable or included in the transaction.

9. Review suppliers, franchise, delivery and digital dependencies

Review franchise, brand, recipe, food-supply, beverage, linen, waste, music, security, reservation, point-of-sale and delivery-platform agreements for assignment, change-of-control, fees, data and termination provisions. Confirm domain, phone number, social account and listing-profile control.

Customer ratings, followers and marketplace visibility are not owned revenue streams. Do not assume a franchise appointment, delivery ranking, supplier rebate, protected territory or digital account will move on unchanged terms without written evidence from the relevant counterparty.

10. Reconcile inventory, deposits and customer obligations

Count saleable food, beverage, liquor, packaging and supplies at closing using an agreed method, age and valuation rule. Separately schedule gift cards, event deposits, catering commitments, reservations, loyalty balances, refunds, chargebacks and outstanding customer claims.

Gift-card proceeds and event deposits are obligations until earned under the transaction documents and applicable law; they are not free working capital. Allocate fulfilment, credit and cash adjustments explicitly at closing.

11. Plan staff, privacy and operational handover

Map management, kitchen, service, delivery and administrative roles, certifications, schedules, compensation, accrued amounts and key-person dependencies. Have employment advisors define offers, terminations, continuity and successor obligations; seller staff do not automatically become buyer staff on the buyer's preferred terms.

Use staged access for employee, customer, reservation and loyalty data under Alberta privacy requirements. Coordinate keys, recipes, passwords, vendors, health inspection, liquor, utilities, insurance, WCB, opening inventory and cash controls in a timed handover plan.

12. Convert findings into closing conditions

Tie landlord consent, property diligence, AHS permit and inspection, municipal business and development approvals, AGLC process, equipment title, lien discharges, WCB clearance, inventory count, financing, insurance and transition deliverables to objective evidence and deadlines.

Ask tax advisors whether any GST/HST election or allocation is available and appropriate; CRA conditions are transaction-specific. This guide is educational and is not legal, tax, accounting, employment, health, liquor, building, fire, engineering, appraisal or business-valuation advice. Commercially does not certify approvals, earnings, equipment or property suitability.