What does a bar renovation usually include?
A bar renovation usually touches four areas: the bar itself, the guest space, the back of house and the systems behind the walls. The cost depends less on square footage than on how much plumbing, electrical and structural work is involved. Moving a bar or adding sinks costs far more than refinishing one in place, so layout decisions drive the budget.
- The bar: bar top, die wall, footrail, back-bar shelving and lighting, underbar layout.
- Guest space: flooring, seating, booths, lighting, sound absorption, restrooms.
- Back of house: walk-in or keg cooler, storage, dish area, office.
- Systems: plumbing and floor drains, electrical capacity, HVAC, draft line runs.
Older buildings add risk. Opening a wall in a century-old corner tavern can reveal wiring, rot or plumbing that must be brought up to current code, which is why contingency matters so much in this business.
Which funding fits each part of the budget?
Split the budget by what each dollar buys. Construction, finishes and labor usually fit a term loan with fixed payments. Equipment with a vendor quote, such as coolers, ice machines, glass washers and draft systems, usually fits equipment financing, where the gear helps secure the deal. Downtime costs and reopening inventory usually fit working capital or a line of credit.
Splitting the request this way often lowers the total cost and keeps each payment matched to something that lasts about as long as the payment does. A term that outlives what it paid for is a sign the structure is wrong.
Compare the products: term loans, equipment financing and working capital.
| Budget line | What it includes | Usual funding |
|---|---|---|
| Construction and finishes | Bar build, flooring, restrooms, lighting | Term loan |
| Equipment | Coolers, ice machine, glass washer, draft system | Equipment financing |
| Permits, design, inspections | Drawings, fees, inspections | Term loan or cash |
| Downtime and relaunch | Rent, key payroll, marketing, inventory | Working capital or line of credit |
| Contingency | Surprises behind walls, delays | Built into the term loan or held as a line |
Can you renovate without closing the bar?
Often, yes, if the work can be phased. Many bars finish the patio or restrooms first, then close for a short, intense stretch to redo the bar itself. Others work overnight and early mornings. Phasing usually costs more in total and takes longer, but it keeps regulars coming in and cash flowing, which matters for a business with thin weekly margins.
A practical phasing plan might look like this:
- Weeks one to three: restrooms and back-of-house work behind a temporary wall while the bar stays open.
- A short full closure: bar rebuild, flooring and lighting, scheduled in your slowest stretch.
- Soft reopening: finish seating and décor while serving.
Plan the full closure around your calendar. A sports bar should not be closed in the first weeks of football season; a college-town pub may prefer summer break.
How should you budget for downtime?
Budget for downtime as its own line, separate from construction. List rent, utilities, insurance, loan payments and the key staff you want to keep on payroll so they do not take jobs elsewhere. Then add a relaunch budget for marketing and opening inventory. Owners often underestimate this line more than construction itself, and a delayed reopening is where projects get squeezed.
Ask your contractor for a realistic schedule and add time. Inspections, backordered finishes and permit reviews commonly push reopening dates. Confirm what inspections and permits your project needs with your local building department before you set a reopening party date.
A line of credit can act as a cushion for delays without paying for money you may not need.
What do funders want to see for a renovation request?
Funders usually want written contractor quotes, recent bank statements and a short explanation of what the renovation changes. Requirements vary by product and funder; many look at time in business, monthly revenue and credit. An operating bar with steady deposits is usually easier to review than a new concept, because the funder can see how the business performs today.
A strong request answers a few simple questions:
- What is the scope, and who is doing the work?
- How long will the bar be closed or limited?
- What changes afterward: more seats, a patio season, food sales, a higher average check?
- How many years remain on the lease, and has the landlord approved the work?
Some approvals come within a day or two, depending on documents, but construction projects often take longer to finalize because quotes and scope need review.
When should a bar hold off on renovating?
Hold off when the lease has little time left or renewal is uncertain, when sales are falling for reasons a new look will not fix, or when the payment would not fit your slowest month. A renovation works best when the room is limiting sales, not when service, pricing or the concept is the real problem. Fix those first.
Signs a renovation is likely to pay back: you are turning away groups because of layout, the patio fills every summer night, or worn restrooms and seating show up in guest feedback. Signs to wait: a new competitor is taking your crowd, or staffing is the real bottleneck.
If existing payments are already heavy, ask about options that lower your payment before adding a renovation loan. See funding for bars and pubs for other common projects.
What you’ll typically need
- Written contractor and vendor quotes
- Recent business bank statements
- Owner identification and business details
- Lease terms and landlord approval
Frequently asked questions
How much does a bar renovation typically cost?
Costs vary widely with the size of the space, its condition and how much plumbing and electrical work is involved. Refreshing finishes in place costs far less than moving the bar or adding restrooms. The only reliable figure comes from itemized quotes from contractors who have walked your space, plus a contingency.
Should I use a term loan or a line of credit for a remodel?
A term loan usually fits a remodel better because it is a one-time project with a clear cost and lasting result. A line of credit is built for recurring, uneven needs. Some owners pair a term loan for construction with a line kept in reserve for delays or slow weeks during the work.
Do I need contractor quotes before applying?
You can start the conversation without them, but most funders want written quotes before finalizing a renovation request. Quotes show the scope and cost, which helps size the funding correctly. Getting two or three quotes also helps you understand what is really driving the price.
Can funding cover lost sales during downtime?
Funding can cover the costs you carry while closed, such as rent, utilities and key payroll, when they are part of a clear plan. It does not replace lost profit directly. Many owners size working capital or a line of credit to cover those costs until sales return to normal.
Does renovating affect my liquor license?
Some changes, such as expanding the licensed area, adding a patio or changing the floor plan, may require approval from your state alcohol beverage control agency or local authorities. Confirm with them before construction starts, since approval timing can affect your reopening date.
Renovate with the money lined up
Share your scope and quotes, and we will look for options through our funding partners.
Updated September 14, 2026 · OpenTab Capital Funding Team