Restauranteurs Clamoring For Closed, Second-Generation Spaces

In addition to our normal news coverage, What Now Atlanta is tracking ways Atlanta’s businesses are adapting to the novel coronavirus and the challenges it brings to brick-and-mortars.

While there’s a growing list of restaurants that have permanently closed in response to the financial hardship brought on by the COVID-19 pandemic, there’s an equally long list of would-be operators anxious to snag those very same spaces to open eateries of their own.

Walter Jordan’s phone has been ringing off the hook with clients looking to claim second-generation restaurant spaces.

“Restauranteurs thinking of closing should call me first,” Jordan, owner of The Dogwood Restaurant Consulting Group, Monday told What Now Atlanta (WNA) in a telephone interview.

“I have clients looking for turn-key spaces in Buckhead, Old Fourth Ward, Midtown, and more, and a restaurant that just closes and walks away is leaving money on the table.”

Turn-key spaces are ideal for operators looking to save money and get up and opened quickly, according to Jordan.

These second-generation spaces are already equipped with a kitchen, are furnished, and can very much be plug-and-play.

“All a new operator has to do is deep clean the closed space, put the utilities, lease, and liquor license in their name, and turn the lights back on, without spending hundreds of thousands of dollars building out the restaurant and months if not years doing it,” Jordan said.

Bill Davis, a commercial associate with KW Commercial Atlanta Perimeter, told WNA on Monday he also has clients “looking to take advantage of what they perceive is a real opportunity.”

“There is certainly some leverage to be had by being willing to assume a lease for a business looking to get out,” Davis said.

“I’m negotiating for two right now, actually, and there are some advantages but each landlord is going to react differently, and not many are ready to completely roll over just yet. I would think patience and persistence are in order.”

And finding a turn-key space, even with a spike in closures, won’t necessarily be a walk in the park, according to Davis.

“I would be cautious, however, from assuming that anyone could walk right into a space and expect there to be a full equipment selection for the taking; most of these folks are looking to get something out of their closing, and most of the equipment and trade fixtures belong to them, not the landlord in most cases. Things like Vent Hoods, Fire Suppression, Cabinets and other fixtures will most likely be left, but I’ve seen desperate people do crazy things to get certain equipment out of a space in order to sell it themselves as a way to recoup their losses.”

Todd Semrau, the owner of Urban Eats Consulting Group, is working with his clients on not just filling turn-key spaces, but creating the next big restaurant innovation.

“While I hate that some restaurants will have to close, the innovation that comes out of this economic cycle will be interesting to watch,” Semrau told WNA.

“For instance, the birth of the fast-casual restaurant category was a direct outcome of the 2008 recession. Back then, customers, accustomed to the quality food found in full-service restaurants traded down to fast-casual concepts that offered better burgers, burritos, and bowls at more affordable prices.”

Semrau said it still remains to be seen how extensive the restaurant losses will be, but there certainly is a “willing group of interested parties ready to pounce on the resulting inventory of second-generation restaurant spaces.”

As for Jordan’s existing clients, he said 80 percent are waiting on reopening until Atlanta Mayor Keisha Lance Bottoms and her advisory board thinks it’s safe to do so, despite having the green-light from Gov. Brian Kemp to reopen dining rooms as of April 27.

[Disclosure: KW Commercial and Urban Eats are What Now Atlanta Preferred Partners.]

[Editor’s note: The novel coronavirus (COVID-19) pandemic is rapidly evolving as is its effect on Atlanta, and the City’s businesses and its residents. Click here for What Now Atlanta’s ongoing coverage of the crisis. For guidance and updates on the pandemic, please visit the C.D.C. website.]