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With the exception, If South Florida In general, the Prakas said the phenomenon is taking place for both chain restaurants and single-owner establishments. It Prakas said he Were with operators People that would Prakas said hes Its really a total economic picture now for every industry. Its intertwined, he said. Central Florida In Weve seen no slowdown in Crossman said Red Lobster recently signed a lease at Crossman & Part of it has been that - as Other factors include strong Orlando-area tourism and - at The Villages - a stable economy. Last In Tampa Bay Patrick Consumer confidence is the Berman said major Rental rates paid by Berman Jacksonville New All of these groups are But Panera and Starbucks have both stopped expansion in some of their tertiary markets, she said. As Clifford said Dunkin Donuts is still on the hunt for Some restaurant concepts are We clearly are Clifford said that new retail projects, if well
perhaps, of Central Florida, restaurant leasing in the states major
markets is waning as real and perceived economic weakness continues.
they arent shutting down altogether, single-owner and chain
restaurants are at least cutting back on their expansion plans, market
observers report.
market is slow. Since the middle of November and December, weve
witnessed a dramatic slowdown in sales and leasing, said Athan Tom Prakas, president and owner of Boca Raton-based The Prakas Group Inc., which specializes in restaurant and night club brokerage.
seems like people are just being cautious, even if their business has
held up. Instead of pulling the trigger on another location, it seems
theyre taking a wait-and-see attitude. Its more of a precautionary
thing than a true problem in some cases, he said.
believes real demand-side weakness is being experienced in mid-scale
restaurants and night clubs - and the situation is actually boosting
the prospects for quick-service eateries.
every day. One Boca Raton operator said he can see his expensive
appetizers and more expensive wines are not selling in this market like
they were a year ago. The average check per head is down. People are
more cautious on their purchases, he said.
have gone to a mid-scale to upper-scale restaurant are cutting back.
Theyre eating out at a lower price point.
cautiously optimistic about restaurant performance in the near future,
but challenges remain. Considering the credit markets, weakness in the
dollar and rising commodity prices, even if the volume of sales is the
same or better, the cost of doing business is much higher, he said.
contrast to South Florida, restaurant leasing in and around the tourism
capital of the world seems to be doing just fine, said John Crossman, president of full-service real estate firm Crossman & Company in Orlando.
that regard, particularly in The Villages, said Crossman, whose
company handles all retail leasing for what is now the largest
single-site residential real estate project in the United States. The
Villages spans more than 25,000 acres in Lake, Sumter and Marion
counties.
the development, where several restaurants have already opened this
year and more are expected in the next 90 days.
Company is a landlords representative handling about 5 msf in
Publix-anchored neighborhood shopping centers, town center projects,
open-air power centers and some middle-class centers. Crossman said
leasing volume in restaurant space can partly be attributed to
flexibility among their landlords.
a landlords representative - our clients are well-heeled. Theyll work
with good retailers to make deals happen, he said. For the product
were marketing, we still have significant interest.
year was the biggest year ever for Disney. The weak dollar has lots of
foreign tourists coming in. That has kept it strong, he said.
The Villages, the growth is from people who arent impacted as much by
the economic situation. They are retiring and have a good portfolio and
equity in their homes. A lot of people come with two cars. When they
trade one in on some golf carts, they spend a lot less money on gas.
Berman, a retail property specialist who does both landlord and tenant
representation for Cushman & Wakefield in Tampa, said restaurant
leasing activity is down across the board.
key factor, Berman said. Low numbers have coincided with a drop in both
general and same-store sales, he said, and many retailers have scaled
back or frozen their expansion plans.
quick-service restaurants like Starbucks and Subway are still opening,
but at a slower pace. Moderate performers are in a holding pattern, and
weak performers are closing units, he said.
restaurants are still in a healthy range, Berman said, but they are
down 10% from the peak in 3Q05. Add in a few incentives like free rent
and higher TI allowances, and the discount is closer to 15%, he said.
said he expects economic conditions to stop deteriorating and begin to
slowly gain ground in the third quarter, with appreciable gains in 2009.
restaurant openings in Jacksonville are heavily influenced by where the
company is in its market development cycle, said Kate Clifford,
president, owner and broker at Strategic Sites/Clifford Commercial. The
company does tenant representation for several national brands
including Panera Bread, Dunkin Donuts, Jasons Deli and Hooters.
in the market because they have a master plan. They are looking to
strategically identify locations all over the city. Panera is in almost
all of their must-have locations and in several of their secondary
areas, Clifford said.
the residential slows down, some of these groups who had identified
sites in those submarkets are kind of pulling back. Theyre saying the
demographics they need to open successfully are not currently there,
she said.
underserved locations with pent-up demand or for locations where
landlord incentives are available.
returning to the Jacksonville market, Clifford said, including
Applebees, Johnny Carinos, Bennegans and Steak & Ale. But
activity among new concepts is down overall.
seeing fewer new concepts coming into the market, but I think thats
also a function of the fact there are fewer new projects out there,
she said.
located, will always have an energy that sustains restaurant tenants.
Restaurants at the St. Johns Town Center mixed-use development, for
example, are performing well despite high rental rates, she said.
Originally posted 2008-06-18 00:00:00. Republished by Blog Post Promoter