Coffee Shop Real Estate Analysis
CoStar Commercial Real Estate Research

Location Performance Metrics:

Foot Traffic Thresholds:
- Minimum viable: 5,000 daily passers
- Target: 10,000+ daily passers
- Premium locations: 25,000+ daily passers

Rent as % of Revenue:
- Target maximum: 8-10%
- Industry average: 11%
- Distressed shops: 15%+

Square Footage Guidelines:
- Minimum viable: 400 sq ft (kiosk/counter only)
- Small shop: 600-1,000 sq ft
- Standard shop: 1,000-1,800 sq ft
- Destination shop: 1,800-3,000 sq ft

Revenue per Square Foot:
- Industry average: $450/sq ft annually
- High performers: $650+/sq ft
- Struggling shops: <$300/sq ft

Location Type Performance:
- High street retail: $520/sq ft average
- Shopping center: $410/sq ft average
- Office building lobby: $680/sq ft average
- Residential neighborhood: $390/sq ft average

Lease Considerations:
- Average term: 5 years
- Rent escalation: 3% annually typical
- Build-out allowance: $15-40/sq ft common
- CAM/NNN adds: 15-25% above base rent

Site Selection Correlates:
- Parking availability: 0.52 correlation with suburban success
- Neighboring businesses: Complementary retail +22% traffic
- Visibility from street: 0.48 correlation with new customer acquisition
