Restaurant equipment loans fund commercial kitchens, refrigeration, POS systems, dishwashers, ventilation, and dining-room buildouts. Section 179 expensing applies; restaurant equipment is 5-year MACRS property eligible for full first-year deduction. Terms typically 3–7 years matching equipment life.
Restaurants are capital-intensive: a full commercial kitchen buildout for a new 60-seat restaurant can run $150,000–$500,000+ in equipment alone. Restaurant equipment financing covers: commercial ranges and ovens ($3,000–$30,000+), walk-in coolers and refrigeration ($5,000–$30,000), commercial dishwashers ($3,000–$15,000), ventilation hoods and fire suppression ($10,000–$50,000), POS systems and kitchen display systems ($5,000–$25,000), prep tables and smallwares, dining room furniture, and bar equipment. These assets qualify for equipment loans (you own the equipment), equipment leases (you rent, option to buy), or Section 179 first-year expensing if purchased.
Under IRS Publication 946, restaurant equipment is 5-year MACRS property and qualifies for the Section 179 first-year expensing election. A restaurant buying $200,000 in kitchen equipment can potentially deduct the full $200,000 in year one instead of depreciating at roughly $40,000/year over 5 years. The 2024 Section 179 limit is $1,220,000. Bonus depreciation (60% for 2024) also applies to new and used restaurant equipment placed in service. Qualified Improvement Property (QIP) — tenant improvements to restaurant interior — qualifies for 15-year depreciation and Section 179 treatment, which is significant for restaurant buildouts.
Major restaurant equipment manufacturers and distributors offer captive financing programs — typically point-of-sale financing at the time of equipment purchase. These restaurant-equipment-manufacturer programs are convenient but compare their rates against independent equipment lenders before signing. Rates on captive programs range from promotional (0% for qualified buyers) to 15%+ APR for weaker credit profiles. Always get at least one independent quote. The SBA 7(a) program is also commonly used for larger restaurant equipment packages — particularly when opening a new location or doing a full kitchen renovation.
Restaurant equipment loans typically run 3–7 years. Rates range from 6–20% APR depending on credit and lender. Qualification: 600+ personal FICO (equipment lenders are more flexible than general business loan lenders), 1+ year in operation, and revenue sufficient to cover debt service. Restaurants face higher equipment financing scrutiny than other industries due to high failure rates — lenders want to see consistent deposit history, not just gross sales. The Federal Reserve Small Business Credit Survey 2024 shows restaurants have approval rates roughly 15% lower than the overall SMB average, reflecting perceived sector risk.
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