The short answer: In California, the contractor who takes on your whole restaurant build-out should hold an active Contractors State License Board (CSLB) license that fits the job, usually a Class B General Building license, plus a $25,000 license bond and the workers’ compensation coverage the law requires. Fire protection work, like the kitchen hood suppression system, must be installed by a C-16 licensed contractor. Beyond the license, look for restaurant experience, insurance your landlord will accept, and a contractor who understands health department, fire, and building reviews before you sign.
Here’s a scenario that plays out more than it should. A new owner signs a lease, hires a friend of a friend who “does restaurants,” and pays a big deposit to get started. Weeks later the health department hasn’t approved the plans, the landlord won’t let the crew in without proof of insurance, and nobody can say who is installing the hood fire system.
A restaurant is one of the most demanding build-outs there is. More trades, more reviewers, more equipment, and a hard opening date tied to rent. Who you hire shapes all of it.
Let’s walk through what California requires, what your landlord will likely ask for, and the questions that separate a restaurant-ready contractor from everyone else.
Who can legally build my restaurant in California?
Start with the license. A job the size of a restaurant build-out requires a CSLB license, and the classification matters as much as the license number.
| License | What it covers | Why it matters for a restaurant |
|---|---|---|
| B General Building | Projects that require at least two unrelated building trades (framing and carpentry don’t count toward the two) | The usual fit for a contractor running the whole build-out |
| C-16 Fire Protection | Lays out, fabricates, and installs fire protection systems | Required for the hood fire suppression system, either directly or through a C-16 subcontractor |
| C-20 HVAC | Heating, ventilating, and air-conditioning | Often handles ventilation, make-up air, and HVAC work |
| C-36 Plumbing | Water supply, waste lines, and fixtures | Sinks, floor drains, water heaters, and grease interceptor connections |
| C-10 Electrical | Wiring, fixtures, and electrical equipment | Panels, circuits for cooking equipment, and lighting |
Two rules are worth knowing.
The two-trade rule. Under Business and Professions Code section 7057, a B General Building contractor can take a prime contract when the project requires at least two unrelated trades other than framing or carpentry. A full restaurant build-out usually qualifies. A single-trade job, like only replacing a water heater, generally doesn’t, unless the B contractor also holds that specialty license or hires a licensed specialty sub.
The fire protection rule. The same section says a general building contractor can’t contract for a project that includes C-16 fire protection work unless it holds a C-16 license or subcontracts with a C-16 contractor. California’s State Fire Marshal has applied the related law to kitchen hood suppression systems: only a CSLB-licensed C-16 contractor may install a fire protection system. So when you review a bid, ask who installs the hood suppression system and check that company’s license too.
What happens if I hire someone without the right license?
It can get expensive in ways that have nothing to do with the work itself.
Under Business and Professions Code section 7031, an unlicensed contractor generally can’t sue to collect payment for work that requires a license, and the person who hired them can sue to recover what they paid. That sounds like it protects you, and in a narrow legal sense it does. In practice you may be left with a half-built kitchen, permits that can’t be closed, and a lawsuit instead of an opening date.
Insurance is the other risk. The CSLB says contractors with employees must carry workers’ compensation, and some trades, including HVAC (C-20), must carry it even without employees. If an uninsured worker is hurt in your space, the cost can fall on you or your landlord. The free CSLB license lookup shows each contractor’s license status, $25,000 license bond, and workers’ comp status, so check it for your general contractor and every specialty sub.
What will my landlord require from my contractor?
Most commercial leases have their own rules for tenant construction, separate from state law. Read your lease and work letter, and expect questions like these:
- Approval of your contractor. Many landlords reserve the right to approve who works in the building.
- Insurance certificates. Landlords commonly ask for proof of general liability and workers’ compensation coverage, often naming the landlord as an additional insured. Limits are set by your lease, not by a standard number.
- Approved plans before work. Landlords often want to review plans, especially for roof penetrations, hood exhaust routes, and slab cutting for plumbing.
- Lien releases and closeout documents. Expect to provide them as part of getting your TI allowance paid.
A contractor who has done commercial work will recognize these requests right away. If yours seems surprised by them, take note.
What makes restaurant experience different?
A restaurant passes through more hands than a typical retail or office build-out. Your contractor will coordinate with your designer and with several reviewers: building and safety, the fire department, the health department, and often the sewer or public works agency for the grease interceptor.
The health department step is the one that trips people up. California Health and Safety Code section 114380 requires food facility plans to be approved before construction or remodeling starts. In Los Angeles County, Environmental Health says plan review takes up to 20 working days after payment, and revised plans must be approved before the changes are built. A final inspection and a public health permit are required before opening. Some cities, including Long Beach, run their own health plan check, so confirm which agency covers your address.
That’s why menu, equipment list, and kitchen layout need to be settled early. They drive the hood, the plumbing, the electrical loads, and the health review. If you’re still evaluating a space, our look at turning a retail space into a restaurant explains what a change of use can trigger.
Questions to ask a contractor before you sign
Bring this list to every interview. Good contractors welcome these questions.
- What is your CSLB license number and classification, and is it active?
- Who will install the hood fire suppression system, and what is their C-16 license number?
- Which trades will you self-perform, and which will you subcontract? Are the subs licensed?
- Can you provide certificates for general liability and workers’ compensation that meet my lease requirements?
- What restaurant or food-service projects have you completed recently, and can I speak with an owner?
- How do you coordinate with the health department, fire department, and building plan check?
- Who orders the kitchen equipment, and who is responsible for receiving and setting it?
- What’s excluded from your bid? (Equipment, permits, utility fees, signage, and low-voltage work are common exclusions.)
- How are changes priced and approved during construction?
- What is your realistic schedule from permit to final inspection, and what could delay it?
How should I compare restaurant build-out bids?
Line by line. Restaurant bids vary widely because of what’s included, not just the price. One bid may include the hood, ductwork, and suppression system. Another may exclude the hood as “owner-furnished” while still showing a lower total.
Before you compare totals, line up the scope: hood and exhaust, make-up air, grease interceptor, plumbing, electrical service, fire alarm or sprinkler changes, finishes, restrooms, and accessibility work. Then ask each contractor to clarify gaps in writing.
Also note that California’s home improvement contract rules, like the down payment cap, are written for residential property. A commercial build-out contract is mostly governed by what you and your contractor negotiate, so payment schedules, retention, and change procedures deserve careful attention (and, for larger projects, an attorney’s review). For a sense of what drives the price, see our breakdown of commercial build-out costs in Los Angeles and Orange County.
What you can handle yourself, and when to bring in a pro
You can do this yourself:
- Look up each contractor’s license and classification on the CSLB website
- Read your lease and work letter for contractor, insurance, and approval requirements
- Settle your menu and equipment list early
- Collect and compare bids using the checklist above
Bring in professionals for:
- Plans and occupant load calculations (a designer or architect)
- Mechanical, plumbing, or structural engineering when required
- Building the work: a licensed general contractor with licensed specialty subs
- Lease or contract terms you don’t understand (an attorney; this article isn’t legal advice)
Frequently asked questions
What license does a contractor need to build a restaurant in California? A contractor running a full build-out typically holds a B General Building license. Specialty work, like fire protection, needs the matching license, either held by the contractor or a licensed subcontractor.
Who can install a restaurant hood fire suppression system in California? A CSLB-licensed C-16 Fire Protection contractor. A general building contractor must hold a C-16 license or subcontract that work to a C-16 contractor.
Can I hire an unlicensed contractor to save money? It’s risky. An unlicensed contractor generally can’t enforce payment, but you may face stalled permits, uninsured injuries, and lawsuits that delay your opening.
Can construction start before the health department approves my plans? No. California law requires food facility plan approval before construction or remodeling starts.
Does my landlord have to approve my contractor? It depends on your lease. Many commercial leases require landlord approval of contractors, insurance certificates, and plans before work begins.
Do California’s home improvement down payment limits apply to restaurant build-outs? Generally no. Those rules are written for residential property, so commercial payment terms are set by your contract.
Planning a restaurant? Talk to us before you sign.
The cheapest time to avoid a restaurant build-out problem is before the lease and the contract are final. A walk-through can flag hood, plumbing, electrical, and accessibility issues early, so your budget and opening date start from real numbers.
De Sisto Construction, Inc. is a California licensed general contractor (CSLB License #803545), based in Signal Hill and in business since 2001. Our commercial tenant improvement services include restaurant build-outs, and we guide permitting, inspections, and code-compliance coordination with line-item costing.
Give us a call at 562-425-1050 or email us at info@desistogc.com (dcidirect.net)