Fairfield County landlords develop a taste for once-scorned restaurant tenants
When Antonio Greco was preparing the September opening of his restaurant Bar Zepoli at 75 Broad St. in Stamford, he acknowledged that he had plenty of competition. “Downtown Stamford has a great food buzz,” he said. “There are a lot of restaurants, one on every corner.”
Yet Greco, who had worked with his brothers for the past 15 years at their family-owned restaurant in New Jersey, felt he was in the right place at the right time. “I was searching high and low in Fairfield County for a place to open a restaurant,” he said. “This was an opportunity that I could not pass up.”
A decade ago, however, the proliferation of restaurant spaces seen here in 2017 would have had little support in Fairfield County”™s commercial real estate market.
“When I started in Fairfield County in 2008, restaurants were the last thing that landlords wanted,” recalled Jessica Curtis, senior managing director at Newmark Knight Frank in Stamford. “Restaurant economics are more of a challenge for landlords. They have a higher electrical capacity and a more intensive use of utilities.”
What happened to change landlords”™ minds?
Curtis noted the retail store tenants sought by Fairfield County landlords disappeared in the aftermath of the Great Recession and the rise of e-commerce. As a result, restaurants began to fill those vacant spaces and bring a new vibe to commercial properties.
“Now, given what transpired with retail and the Amazon effect, landlords have seen restaurants as a way to create energy and drive lots of people to a project and also serve as an anchor for a neighborhood,” said Curtis. “Anecdotally, some of the towns that we”™re working with have been requesting more restaurants.”
Fairfield County”™s demographics have also helped to encourage new restaurants.
Sergio Tamburlini, general manager at 129 in New Canaan, said his town was the perfect location for a restaurant. “It is a very affluent area. I believe it has the third richest ZIP code in America. People can afford to eat out almost every night of the week. It is very rare for a New Canaan family to cook at home.”
Tamburlini noted that 129 had an advantage that startups in the industry rarely enjoy: it operated for 11 years as Chef Luis Restaurant and was rebranded and redesigned before opening under its new name and menu in November. But even with a new identity, Tamburlini said, 129 has continued to attract the patrons it cultivated over the years.
Tim LaBant, chef and owner of The Schoolhouse at Cannondale and the upcoming pizza-focused restaurant Parlor, both in Wilton, said that a restaurant”™s success is based primarily on patrons”™ emotional experience.
“It”™s about service,” he said. “People will come back for the service before they come back for the food. Everybody wants to go to a restaurant and feel important. Anyone can order take-out or make their own food, but there is something very special about being taken care of, being made to feel important. And it takes you out of the daily grind for a little bit.”
LaBant also stressed that knowing how people enjoyed their dining experience is crucial to success.
“If you ask somebody how was their meal and they say, ”˜It was OK, it was good,”™ you know that it wasn”™t good,” he said. “But if they are like, ”˜Oh, my gosh, it was amazing, I am so happy,”™ then you”™ve got them and you know they”™re coming back.”
Along with the rewards, restaurateurs like LaBant also have their share of business-induced headaches.
“With all of its positives, the industry is a very difficult one to be in,” said Sarah Maloney, executive director of the Connecticut Restaurant Association. “This industry carries a high overhead and very little room for profit. And locally, you have to deal with Connecticut rents, mill rates and taxes.”
At the state trade association in Hartford, “A few large chains contacted us about coming to Connecticut,” Maloney said. “They asked questions about doing business in the state. Unfortunately, after giving them the information they requested, they decided not to come into the state, due to regulations and the costs of doing business here.”
Finding the right real estate can also be a challenge and deterrent for franchise and chain restaurants requiring larger square footage than independently owned eateries.
“Chain restaurants often have to look harder to get into prime Fairfield County space,” said Ryan Stranko, vice president at RHYS, the commercial real estate firm in Stamford. “They are looking for standalone buildings or end caps (corner spaces) or high-profile buildings. In high-traffic areas like Connecticut Avenue in Norwalk and Bridgeport Avenue in Shelton, space is available, but it is not necessarily what they want.”
Will the county”™s ongoing boom in restaurant openings glut the market?
“There should be some sort of settling out at some point,” said Curtis at Newmark Knight Frank. “An oversaturated market can theoretically only support an ‘x’ number of seats.”
Robert Savin, who opened Wings Over Fairfield on the town”™s restaurant-heavy Black Rock Turnpike in August, agreed. “Major chains are closing and the restaurant industry is growing at twice the rate of the general population,” he said. “Too many restaurants are looking for the same dollars.”
But Greco at Bar Zepoli said the market is more than able to support a surplus of restaurants. “There is a great deal of variety and the population to support it, especially in Stamford,” he insisted. “There is an audience for it.”
The Connecticut Restaurant Association does not anticipate a reversal ahead for a restaurant and food service industry that accounted for 154,100 jobs in the state in 2017, 9 percent of the state”™s total employment. That number is projected to grow in the next decade by 7.1 percent, with an additional 11,000 positions in restaurants and food service bringing the industry total in Connecticut to 165,100 jobs.