Launching a restaurant in Canada is a dream for many aspiring entrepreneurs and established hospitality groups. But before opening day, one major question looms large: How much does it cost to build a restaurant in Canada in 2025? From restaurant design to restaurant development and construction, understanding every line item is essential to avoiding budget overruns and ensuring a successful launch.
In this guide, we’ll provide a detailed cost breakdown of restaurant construction costs, explore key cost drivers, and offer expert tips to help you manage your budget effectively. Whether you’re building a quick-service restaurant (QSR), café, or full-service dining establishment, this 2025 update offers everything you need to know.
Average Restaurant Construction Costs in Canada (2025)
In 2025, restaurant construction costs in Canada typically range between $150 per square foot for basic restaurants with cost-efficient finishes, to over $500 per square foot for high-end projects featuring premium materials and luxurious finishes.
| Restaurant Type | Low Range (CAD/sq ft) | High Range (CAD/sq ft) |
|---|---|---|
| Quick Service Restaurant (QSR) | $150 | $350 |
| Casual Dining | $250 | $500 |
| Fine Dining / Premium Hospitality | $350 | $600+ |
🔎 Expert Insight: Costs tend to be higher in major urban centres like Toronto, Vancouver, and Calgary due to increased labour and permit fees.
Key Factors Influencing Restaurant Construction Costs
1. Restaurant Design & Layout
Your restaurant design plays a significant role in determining overall costs. An efficient, code-compliant layout will reduce waste and avoid unnecessary redesigns.
Design-related costs may include:
- Concept development & branding visuals
- Interior design & 3D renderings
- Architectural and engineering drawings
- Permit drawings and building code compliance
Estimated Cost: $25,000 – $100,000+ depending on complexity, scale, location and work involved
2. Size and Scope of the Project
Naturally, the larger the space, the more it costs to build. A 1,200 sq ft café will be vastly different in scope from a 4,000 sq ft full-service restaurant with a mezzanine and rooftop patio.
3. Location & Building Conditions
- Urban locations typically command higher leasehold improvement costs due to stricter zoning, higher permit fees, and labour costs.
- Existing building conditions matter. A cold shell (unfinished space) is more expensive to finish than a warm shell or second-generation restaurant space.
4. Mechanical, Electrical, and Plumbing (MEP)
Restaurants are heavily reliant on MEP systems to support kitchens, fire suppression, HVAC, and washrooms.
Typical MEP costs include:
- Electrical rough-in and panels: $20–$40/sq ft
- Plumbing for kitchens and washrooms: $25–$50/sq ft
- HVAC upgrades or rooftop units: $30–$60/sq ft
💡 Pro Tip: Invest early in accurate engineering to avoid costly rework or code violations.
5. Kitchen & Equipment Installation
A commercial kitchen is often the most expensive part of the build.
Equipment can include:
- Exhaust hoods and suppression systems
- Ovens, fryers, grills, refrigerators
- Stainless steel prep tables and dishwashing stations
Estimated Cost: $100,000 – $300,000+ depending on equipment type and brand
🛠️ Work with a restaurant contractor who understands commercial kitchen workflows and health code requirements. Some top Restaurant Kitchen Equipment suppliers include Nella Equipment, Russell Hendrix, SFI Hospitality, etc.
6. Interior Finishes & Furnishings
Your restaurant’s ambiance directly affects customer experience. High-end finishes and materials come at a premium, but so does poor craftsmanship.
Finishing costs include:
- Flooring and wall treatments
- Lighting fixtures
- Custom millwork and bar installation
- Furniture, tables, and seating
Estimated Cost: $75–$250 per sq ft
Soft Costs in Restaurant Development
Beyond construction, there are soft costs that should be factored into your overall budget.
| Soft Cost Category | Typical Cost Range |
| Design & Architectural Fees | $25,000 – $100,000 |
| Permits & Inspections | $5,000 – $25,000 |
| Legal & Consultant Fees | $3,000 – $15,000 |
| Project Management | 5–10% of total construction |
Ways to Reduce Restaurant Construction Costs
- Choose a Restaurant Contractor Early
Hiring a professional and experienced restaurant contractor during the design phase ensures value-engineering opportunities, fewer delays, and realistic budget alignment. - Consider Second-Generation Spaces
Leasing a former restaurant space with existing plumbing, ventilation, and rough-ins can cut build costs by up to 30%. - Use Cost-Efficient Materials
Mix high-impact focal points with cost-effective materials in less visible areas. - Bundle Trades Under One Restaurant General Contractor
A single point of contact minimizes coordination issues, risks and change orders.
Working with a Specialized Restaurant Contractor
Partnering with a restaurant contractor experienced in restaurant building and restaurant development ensures your vision is brought to life efficiently and within budget.
Benefits Include:
- Deep knowledge of local codes and health regulations
- Access to vetted suppliers and subcontractors
- Proven experience in kitchen layouts, ventilation, and workflows
- Faster permitting and approvals
Look for contractors who offer design-build services, combining design, engineering, and construction under one contract for a streamlined process.
Conclusion
Building a restaurant in Canada in 2025 involves a wide range of factors—from location and design to kitchen equipment and permit approvals. With restaurant construction costs averaging between $150 and $600+ per sq ft, it’s critical to develop a realistic, well-researched budget.
By understanding the full scope of costs, working with an experienced restaurant contractor, and applying cost-saving strategies, you can build a beautiful, efficient, and profitable restaurant space.
📈 Want expert help with your restaurant development project? Contact us today for a free consultation and let’s build something great together.
