Parlez vous Français?
Oui? Good, because it could be the new language of shopping center restaurant cuisine. French bashing, so popular just a short time ago, has given way to adoration for frites, brioche and even vin. French bistros and bakeries are the newest entry on the restaurant scene.
Chicago-based Lettuce Entertain You Inc., for example, is expanding its Mon Ami Gabi concept to lifestyle centers (see story on page 68). The bistro-style menu features steak frites, fish dishes and an extensive wine list, among other choices. And French import PAUL, a bakery café with more than 300 units in Europe and the Middle East, opened its first U.S. store in Florida this year and aims to have 100 more throughout the Southeast over the next five years. Another French bakery café, La Brioche D'Or, is also eyeing upscale properties in the United States.
Restaurants are big business for shopping centers, especially in light of failing department stores and increased emphasis on entertainment. The success of The Cheesecake Factory Inc. and P.F. Chang's China Bistro Inc. prove their importance, particularly in lifestyle centers. These and other relatively upscale, casual eateries can help define the ritzy atmosphere developers strive for, draw traffic and ring up impressive sales.
“We look at restaurants as mini-anchors,” says Terry McEwen, president of Poag & McEwen Lifestyle Centers LLC. “A Cheesecake Factory can do as much as $10 million in sales and we'll have up to a dozen other food operations at each center, which would include full-service sit-down restaurants, fast casual and specialty foods.”
Recognizing the unique importance of restaurants, a growing number of developers are designating executives to focus exclusively on this tenant base. Poag & McEwen, for instance, brought a specialist on board this spring to oversee restaurant leasing in its development pipeline.
Similarly, CBL & Associates Properties Inc. hired an executive to work with food and entertainment tenants as the mall owner redevelops its properties to include lifestyle center-like touches such as outdoor courtyards.
Many of thethese owners sign will no doubt be with Cheesecake Factory and P.F. Chang's, which continue to add stores and post sales growth. (But there are a limited number of outlets and developers must always search for something new.)
Here Come the French
To many, French food is synonymous with exquisite dining — and prices to match. A growing number of concepts are banking on the idea that Americans will go for French bistro-style cuisine. It's still high-quality food, but it's served in a more casual ambience. The price point is lower, too.
Kevin Brown, Lettuce's president and CEO, described it as “polished casual.” Mon Ami Gabi currently has four locations — two of which are in lifestyle centers — and has plans for four more.
PAUL has grander visions. Luc Bansay, vice president of PAUL USA, says the European chain will open in a variety of retail locations, but its high quality and French pedigree make it an ideal fit for the ritzier atmosphere of lifestyle centers.
Breads are PAUL's specialty and it offers a selection of more than 140 varieties, baked daily using recipes handed down since the original shop opened in 1889.
The café also features a full menu for breakfast, lunch and dinner, as well as an impressive selection of wines and champagne.
Bansay acknowledges that his model is difficult to categorize because it straddles different market segments: part fast-food, part casual, part upscale casual, part specialty. He prefers the term “affordable luxury” to describe PAUL's concept.
A third French chain, La Brioche D'Or, is looking for locations. Ralph Ours, a senior leasing associate at Federal Realty Investment Trust, says he is negotiating with the chain to open shops in the REIT's metropolitan Washington, D.C., properties. La Brioche D'Or boasts a selection of reasonably priced baked goods and sandwiches, as “a good complement to Starbucks.”
CBL, too, is watching the French concept category carefully. “It's something that's been largely untapped on a national scale,” says Bryant Siragusa, the REIT's national director of mall restaurants and entertainment. “It might be an exciting new segment going forward; a new trend we see.”
Another foreign influence on U.S. dining: Mediterranean. Levante's started in Turkey, spread to other countries and has now come to the U.S. Two are open in Washington, D.C. and two more are planned for Virginia. The company is looking for other locations, too.
Bar Food Gets a Good Name
As one might expect, French concepts often feature large wine selections. This reflects the traditional importance of wine in European cuisine, as well as its growing popularity in the United States. “Americans in general are becoming more attuned to wine and what it does for a meal,” according to Brown.
“And people are not afraid to pay more when they're buying wine by the glass; it's kind of an inexpensive luxury you can give yourself,” Brown says.
Even as Americans experience different vintages and vineyards, that doesn't mean their thirst for beer has diminished. Ale houses and sports bars are increasingly popular, too, as evidenced by the growth of Fox Sports Grill, ESPN Zone Sports Bar and BJ's Brewhouse.
More casual sports-themed establishments, such as Damon's Grill, are also adding locations — some of which are in more upscale retail centers. What sets most of these concepts apart from your average watering hole is their high-quality food.
“These guys have realized they just can't be a bar,” says John Artope, vice president of Staubach Retail Services. “There are nice margins involved in selling beer, alcohol and wine, but at the same time you have to do something different to bring people in on a regular basis and during the times between happy hours.”
The Yard House Restaurants LLC has mastered the skill of attracting a diverse range of people during different times of the day. Part ale house, part sports bar, the Yard House boasts up to 250 draft beers on tap, an abundance of large flat-screen televisions and a dance club sound system pumping out classic rock. Its food menu features more than 100 dishes.
“The hook is the beer. Everybody wants to see that many beers on tap,” says Steele Platt, Yard House founder and CEO. “But our food quality is above what people expect. People come in expecting bar food, but they find more of a P.F. Chang's, Cheesecake Factory level food and that ends up driving our business.”
Since the first location opened in 1996, Yard House has grown to include eight restaurants in, as well as one in Illinois and one in Colorado. This year it will open a new location in California, and stores in Arizona and Florida. After that, Platt plans to build on Yard House's presence in existing markets before expanding into new cities.
In choosing the lineup of restaurants at a lifestyle center, brand recognition is everything, says Stan Eichelbaum, president of Marketing Developments Inc., a retail consulting firm. Most property owners strive to create a unique sense of place by partnering with well-known regional players as well as one or two strong local restaurateurs. In the end, though, national names generally have the best draw.
“In a major market with high levels of competition and high-volume potential, you want one or two of the top six restaurants, like a Cheesecake Factory,” Eichelbaum says. “Its notoriety and overflow will raise volume at other restaurants.”
And when choosing a nationally recognizable name, a few cuisines remain perennial favorites for the American palate. They include steak, seafood and Italian, says Ron Paul, president of Technomic Inc.
Their popularity is evidenced by the steady growth of, say, Fleming's Prime Steakhouse, Bonefish Grill and Johnny Carino's Country Italian.
Asian concepts are also an increasingly safe bet, Paul says. Thanks largely to the success of P.F. Chang's, the category is now brimming with a cornucopia of chains such as Pei Wei, P.F. Chang's fast casual spin-off, Noodles & Company and Todai. And the category has room for even more growth.
Let Them Entertain You… Again
Lettuce Entertain You Inc. is more than a cute name. Founder of Maggiano's Little Italy and the Corner Baker Café, both of which it sold to restaurant powerhouse Brinker International Inc. in the late 1990s, the 24-year-old Chicago restaurateur is again looking at mall and lifestyle center locations. Brinker, meanwhile, has undergone a reorganization after the IRS asked it to reclassify rental expenses at certain properties.
Lettuce Entertain You, founded in 1971, was an instant Chicago success with restaurants like R. J. Grunt's and Jonathan Living Seafood. It grew slowly regionally until the 1990s when it created the Corner Bakery and Maggiano's. Now, it's resurfacing in the retail environment with Mon Ami Gabi and, possibly in the future, other concepts.
In March, it repurchased Big Bowl Asian Kitchen, a chain it had also sold to Brinker. Big Bowl serves up a fusion of Chinese, Thai and other Asian cuisines. The chain has seven locations throughout the Midwest, plus one in Virginia. Kevin Brown, president of Lettuce Entertain You, says that while he has no plans to open new Big Bowls this year, he does anticipate expanding it in the future.
The reason is simple: Brown believes Asian cuisine's popularity is strong. He also sees potential in French cuisine. In addition to slowly adding its Mon Ami Gabi locations, Lettuce Entertain You recently introduced a French concept called Magic Pan Crepe Stand. Brown is also bullish on steak houses and plans to continue growing the Wildfire concept, which he describes as a “classic 1940s style” steak house.
For now, it remains a Chicago-centric business with over 30 restaurant names (many of which have more than one location), but its success in creating Corner Baker and Maggiano's shows it is a force to be reckoned with when it moves into shopping centers.
WHAT'S FOR DINNER?
Not every mall or lifestyle center can snag a Cheesecake Factory or P.F. Chang's. The competition is stiff and some older chains are struggling, which leaves many developers searching for new casual style restaurants.
Seek out the hottest new concepts, starting with the French-themed bakeries and bistros that are popping up across the country. Lettuce Entertain You's Mon Ami Gabi and French imports PAUL and La Brioche D'or are bringing fries, exotic breads and wine to soothe the tired shopper's soul — and feet.
Americans are imbibing more wine, but their thirst for beer continues. The new French restaurants offer wide selections of wine by the glass, while at least one ale house offers 250 kinds of beer on tap.
Restaurants are big business. One Cheesecake Factory can bring in as much as $10 million in sales. The company's total 2004 sales topped $1 billion. That means a lot of foot traffic wherever one is located.