All perfect praise be to Allah, The Lord of the Worlds, and may His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.
Since preserving life and wealth are among the most important higher objectives of Sharia, Muslims aren`t only commanded to stay away from harmful and evil things, but they are also commanded not to have or sell them. Allah, The Almighty, clarified this in the following verse: " …..making lawful for them the good things, and making unlawful for them the vile things,"{Al-A`raf, 157}. Also, the Messenger of Allah, may Allah bless him and grant him peace, said, "There is no injury nor return of injury."{Related by Ahmad in his Musnad}.
Moreover, it is worth pointing out that cigarettes and hookah corrupt the human body and cause numerous diseases as confirmed by physicians.
In conclusion, it is permissible to open a restaurant for offering lawful things, but it is impermissible to offer, smoke or sell hookah; rather, it should be avoided and society should be protected from its harm since this is a duty that can only be fulfilled by fearing Allah first, and cooperation between people and authority, second. And Allah knows best.