Restaurant and commercial kitchen equipment appraisals.
A restaurant equipment appraisal from Lukes & Lukes is an independent, USPAP-compliant opinion of value for the full back and front of house: cooking lines, hoods and fire suppression, walk-ins and refrigeration, prep and warewashing, bar systems and FF&E (furniture, fixtures and equipment).
Kitchen equipment depreciates hard against a deep used-dealer market, and the installed assets often cost more to remove than they return. We state the FF&E versus leasehold improvement line the way a lender needs it. Every report is built to withstand lender, SBA, IRS, audit and legal review.
What we appraise
The kitchen, line by line.
We value the whole operation, from a single-location cafe to a multi-unit kitchen package, and we separate the equipment from the leasehold improvements before the number goes in the report.
- Cooking lines: ranges, ovens, fryers, griddles, charbroilers and combi ovens.
- Ventilation and safety: hoods, makeup air and fire suppression systems.
- Refrigeration: walk-in coolers and freezers, reach-ins and prep tables.
- Prep and warewashing: mixers, slicers, food processors and dish machines.
- Beverage, bar and FF&E: espresso and bar systems, ice machines, seating, tables and smallwares.
What drives the value
Brand tier, condition, and what is bolted to the building.
Restaurant equipment takes its steepest depreciation in the first owner's hands, because the used-dealer market is deep and buyers can source clean equipment readily. Brand tier matters: heavy-duty lines hold value, light-duty equipment does not. Condition is read against the health code, since a buyer inherits the inspection. The installed assets cut the other way.
Hoods, fire suppression and walk-ins are expensive to buy and install but often cost more to remove than they return, so their liquidation value can be near zero while their value in place is substantial. And because most restaurants lease their space, we state which assets are FF&E and which are leasehold improvements, the distinction a lender's collateral position depends on. SBA change-of-ownership loans are the most common reason a restaurant appraisal gets ordered.
Which value applies
The right premise for the situation.
The same kitchen carries different numbers depending on why you need the appraisal. We determine and defend the premise your situation requires.
In one minute
Three things that decide the value.
The purpose sets the number, installed is not the same as removed, and condition is verified on site. One minute, before you buy, sell, or finance a commercial kitchen.
Video · 1:11 · with transcript
Common questions
Answers, up front.
Why does restaurant equipment lose value so fast?
Because the used-dealer market is deep. Buyers can source cleaned, tested equipment from dealers nationwide, so the steepest depreciation lands on the first owner. Heavy-duty brands hold value better than light-duty lines, and condition is read against the health code, since the next owner inherits the inspection.
What are hoods, walk-ins and fire suppression worth?
In place, a lot; removed, often close to nothing. These are installed assets, and the cost to dismantle, cap, patch and freight them frequently exceeds what they bring at resale. That is why their value in a going concern is substantial while their liquidation value can be near zero, and why we state both when the assignment calls for it.
What is the difference between FF&E and leasehold improvements?
FF&E is the furniture, fixtures and equipment the business owns and could remove: cooking equipment, refrigeration, seating, smallwares. Leasehold improvements are built into the landlord's space: ductwork, plumbing, flooring, built-in counters. Lenders need the line stated correctly because only the FF&E secures the loan, and we draw it asset by asset.
Will an SBA lender accept a restaurant FF&E appraisal?
It is written for that file. Furniture, fixtures and equipment stay separate from leasehold improvements and from the real property, which is the split that gets 7(a) restaurant files sent back. Hoods, walk-ins and fire suppression are addressed explicitly. USPAP-compliant, signed by a CMEA.
We are buying a restaurant and close in three weeks. Can the equipment appraisal be done in time?
A restaurant equipment appraisal is paced by placement agreements more than by the kitchen. Ice machines, dish machines, soda and coffee equipment and draft gear are often supplier-owned, and POS hardware is often financed, so the seller's agreements are read before anything is counted. The kitchen walk itself is planned around service.
What drives the cost of a restaurant equipment appraisal?
Location count, the size of the kitchen line, and whether the report must split FF&E from leasehold improvements, which an SBA 7(a) file requires. Franchised units add work: chain-spec equipment and approved-supplier rules decide who can buy it. In a restaurant purchase the buyer usually pays; in a closure ordered by the lender, the borrower or the estate does.
Our restaurant equipment is fully depreciated for taxes. Is it still worth something?
Yes. Tax depreciation follows the recovery periods and the bonus or Section 179 elections described in IRS Publication 946, and it often carries recent equipment at zero on the books; an appraisal measures what the equipment is worth in the market. The appraiser estimates effective age and remaining useful life from condition, brand tier, refrigerant and parts support, so a heavy-duty range can have years left after it is written off while a reach-in on a phased-down refrigerant can have less than its schedule suggests. How a value is used on a return is a question for your CPA.
We are closing the restaurant. What is the equipment worth in a liquidation?
Restaurant equipment in a liquidation is appraised at orderly or forced liquidation value, well below fair market value in place, with used-equipment dealers as the usual buyers. The lease sets part of the answer: which items the landlord can keep as fixtures, and how long the equipment can stay in the space, which decides whether the sale is orderly or forced. Heavy-duty cooking lines and refrigeration from known brands recover the most; seating, smallwares and decor bring little at auction.
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