High & Rising Rents: How are Small Coffeeshops Helping Owners Save Money

Coffeeshop owners are being hit hard by the rising price of rent. While stats on average food retail lease prices in Canada do not exist, according to an annual report released by Cushman & Wakefield, rent on Toronto’s Bloor street were $300 per square foot and $100 on Queen Street West. This stat gives a glimpse of how cutthroat viable lease options are in the already competitive restaurant industry in Toronto. It’s also making certain coffee shop owners get crafty with the type of storefront they’re opening.

On the busy Spadina Ave. you’ll see lots of shops and offices and then – a floor to ceiling window with a single worker preparing coffee for curious passerby’s. Owner and barista Joshua Campos have set up The Coffee Lab, a literal hole in the wall, where once dingy display window of a low-rise office building on Spadina sat.

“The idea is just to keep the overhead super low,” Campos admits. The Toronto coffee shop owner who has jumped onto the micro-cafe trend revealed that compared to his 25 seat shop, he pays about one-sixth in rent. “It worked out for the best,” he says. “It’s a better location — it’s closer to downtown. Plus, people used to be right out front of the shop, and they couldn’t find the place.”

The concept was first rejected by the building owner who had assumed prospective renters would understand that the “For Lease” sign meant the entire office space and not just the window display. However, Campos persisted, and soon the 18 square feet space (the size of two twin mattresses) that is only enough room for a machine, grinder, fridge, sink, hot water dispenser and Campos was his own.

Campos has big ideas for his small space. Currently, he is in talks with the Guinness Book of World Records to recognize his little coffee shop as the smallest, a certificate that is now held by a 22 square foot space in London, England. “My (other) goal is to have the first Michelin-star coffee shop, where every detail is important, whether it’s the spoon, your cup, the coffee – everything.”

While some cafes will see a hit in their sales during the winter months, many say that their unique appearance is an absolute hit for those hunting for a great Instagram shot or the latest eccentric hangout. You have to hand it to these entrepreneurs to not throw in the towel despite the high cost in rent!

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