MENOMONEE FALLS, Wis., Aug. 13, 2025 /PRNewswire/ — Indiana has been named the most affordable state to lease restaurant space in the United States, according to new research from Alto-Shaam, commercial foodservice equipment and technology innovator.
To benchmark the relative affordability of leasing restaurant space across the US, Alto-Shaam analyzed the average annual cost per square foot to lease restaurant space in each state, comparing it to local earnings to determine what percentage of the average annual salary would be required to cover lease costs.
The 10 most affordable US states to lease restaurant space are:
Lease cost decides more restaurant outcomes than menus do: Manhattan Resto lays out the lease math behind most New York closings, with rent at 8 to 12 percent of sales against low single-digit margins.
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State – % of annual salary spent on leasing a restaurant |
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1. Indiana – 124% |
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*Based on local average cost ($) per square foot per year to lease an average-sized restaurant |
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Alto-Shaam’s research shows that the annual cost to lease restaurant space in Indiana is $14.50 per square foot. This is the cheapest price of any US state overall and relative to local wages, and 78% cheaper per square foot than the least affordable state of New York.
Challenges to opening a restaurant
Even in more relatively affordable states like Indiana, ongoing inflation has continued to pose significant challenges for foodservice providers across the nation.
Food and labor costs have increased by an average of 35% in the past five years in the US. While commercial kitchen entrepreneurs will find it useful to see where leasing affordability is better, there are several growing costs that threaten the tight profit margins of foodservices.
Cost-cutting with more efficient kitchen equipment
Kristina Bladecki, Director of Culinary at Alto-Shaam commented on the challenges of finding ways to reduce costs: “When operators are already tied up with leasing and startup expenses, they’re faced with the need to cut costs, and the last thing they want to cut is the quality of food or customer experience.
“There are measures that restaurants can take to reduce expenses in the back of house. For example, using ventless technology instead of a traditional hood system can save on high running costs which can reach up to $20,000 per year, while still achieving the same results in the food served.”
SOURCE Alto-Shaam
Originally published at https://www.prnewswire.com/news-releases/alto-shaam-research-reveals-indiana-is-the-most-affordable-us-state-to-lease-restaurant-space-302528858.html
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