Atlanta Restaurant Real Estate
This Week on The Street (A more or less regular compilation of news, factoids, and observations.
January 28, 2019
by Harold V. Shumacher
A Nibble of the Big Apple
I’ve been going to New York City since I was a small town, fifteen-year-old. I was amazed then at the tall buildings, the bustle, and the massive numbers of people clogging the streets and still am. Every time I go there’s a palpable energy in the air upon arrival and a great sign of relief when I depart. A recent trip in early January was no exception.
So What’s New? First, a taste of the familiar. Chick Fil A has four stores currently open with more to come. Two are blocks apart on Sixth Avenue and both appear busy day and night.
There are more vacancies, throughout the city, especially for small store space. Rents are reportedly declining, though by our standards a ‘good deal,’ at $150/sq. ft. is hard to fathom.
Experiential retail remains a popular niche. The National Hockey League (NHL) now has a store selling team memorabilia and jerseys within blocks of its NBA counterpart. The M&M candy store remains a popular destination. Even Major League Baseball wants a piece of the action with the late 2019/early 2020 opening of the Jackie Robinson Museum in the Soho/Tribeca area.
Small shop, kiosk retail is growing in popularity whether at year around markets, like in Midtown ‘s Bryant Park, a nearby empty big box space turned into small stalls (think of a flea market type environment) or the weekly Flea Markets held in various parts of the city.
We went to one in Chelsea, within blocks of the city’s first Eataly and the Chelsea Market (the inspiration for Ponce Market also developed by Jamestown.)
The original Halal Guys street cart, now expanded into a national chain, continues to do gangbuster business with five carts located within a few blocks of each other around Rockefeller Center. (The chain’s second bricks and mortar location is now open in Midtown Atlanta.)
Affordable housing remains a challenge. As Manhattan and Brooklyn continue to grow, with numerous sliver buildings popping up on what appear to be nearly unbuildable footprints, the outer boroughs, especially Queens and the Bronx are being discovered as is nearby Hoboken, New Jersey with its skyline views. The high cost of real estate doesn’t seem a deterrent, as the growth rates remain impressive. The fall off, if any, is at the ultra high end of the market, even though the most expensive piece of real estate in American history closed this week for an eye-popping $230 million (more or less $10,000 sq. ft.)
The high line, an inspiration for the Atlanta Beltline, continues to grow in popularity. As you walk north, starting in Chelsea, toward the massive Hudson Yard development that dominates the city’s west side there are several buildings where the line goes through the middle (essentially development utilizing the air rights.)
The restaurant scene remains vibrant and the number of artisanal coffee shops, wine bars, poke stands and gourmet burger spots making an appearance can identify much like in Atlanta, emerging neighborhoods.
Super Bowl is Upon Us
The Super Bowl, with all its incumbent hoopla (now a 10-day extravaganza of parties, exhibits, and concerts) will soon be upon us. Local area food distributors and suppliers have been preparing for weeks but one aspect that I’ve found interesting is that with so many big name restaurants sold out to private groups for the entire night the operators are actually ordering less food (doing one seating instead of two or three) but charging a higher price to customers. All is all it should be a good week, especially for restaurants closer in and in the heart of the action.
When the Fed Talks, People Listen
To sum up the state of the economy in a few short paragraphs, especially when the insight comes from Raphael Bostic, the current president of the Reserve Bank of Atlanta, is a challenge but here goes. The country’s basic metrics are strong, employment is at or near record lows, retail sales, especially through the holiday season were encouraging and inflation is moderate.
There are insecurities; the once seemingly invincible Chinese economy now appears more fragile. There is uncertainty about Brexit and what that means for the United Kingdom and mainland Europe plus the repercussions of what is now America’s longest government shutdown.
The real damage, Bostic, notes, is that the long-term damage may be more psychological than physical. Historically entrepreneurs in America were bold and confident, now there’s a hesitancy to act, a concern that another shoe might drop and you’ll find yourself exposed, overcommitted and under-resourced. As a result, many businesses are reluctant to expand, add people to the payroll or make necessary investments in research and development.
Recent transactions for the Shumacher Group, Inc. include
Hot Worx- Smyrna, Johns Creek & Dunwoody
Ramaya Indonesian-2285 Peachtree
Sales of the Following Businesses
Cakes & Ale-Decatur
For a more comprehensive list of recent transactions please visit our website www.shumacher.com