Executives from two Twin Cities success stories shared thoughts on locating and developing eateries.
Any commercial landlord would be thrilled to land a tenant like Parasole Restaurant Holdings or Hemisphere Restaurant Partners, two outfits whose track records place them among the most successful eatery creators in the state.
And at a time when retail space vacancies are hovering around 8.5 percent in the Twin Cities market, landlords remain in tough competition to lure popular eateries, especially two homegrown success stories.
But what does it take to get them to bite on a lease?
This month, executives for the two restaurant firms told members of the Minnesota Shopping Center Association that choosing where to locate is part of a process that mixes the latest dining trends, opportunistic locations and the individual visions and market niches of each new eatery.
Since its founding in 1977 with Muffuletta in St. Paul, Parasole has grown into one of the most creative forces in the restaurant industry, rolling out concepts ranging from power steakhouses like Pittsburgh Blue and the Buca di Beppo Italian cuisine chain to the popular Salut Bar Americain in Edina and the Good Earth healthy eating concept.
Alan Ackerberg, chief development officer and partner at Parasole, said that like retail tenants of all stripes, his company looks for "the usual suspects" in choosing its locations. Building access, parking, signage and density are all key.
The company is also big on "second-generation" spaces, sites that once housed another restaurant.
"We love them," he said. "When we rolled out Buca years ago, between 1997 and '98, we did almost 100 of those -- and every one of the first 40 or 50 were in second-generation restaurant spaces or were adaptive re-uses of existing buildings. We learned how to do that really well."
Ackerberg said fundamental utility services are often already sized for a restaurant, and there may be grandfathered rights in terms of parking requirements and signage, which is a huge benefit.
But, he cautioned, second-generation spaces also bring their own kinds of problems.
"You're always faced with decisions on whether to leave things as they are or tear it down," he said. "For example, you may have a (heating, ventilation and air conditioning) system that's seven to 12 years old and is working. Do you spend the money to replace it, or keep it and roll the dice?"
When picking a site, he added, each restaurant is different.
"What does the concept need? Does it need daytime population? Does it need shopping, corporate business? Pittsburgh Blue, for instance, wants and needs that corporate daytime business, while Good Earth needs nearby apparel shopping."
Anoush Ansari, the co-founder and managing partner for Hemisphere, said his company has also enjoyed success with second-generation spaces, such as its Mission American Kitchen & Bar in the IDS Building, which it took over from the former Aquavit restaurant in 2004 and redesigned to add a street entrance off Seventh Street.
"In that instance, we really had to reconfigure," he said. "We put the bar where we thought it got the most attention. Every room, every space has different energy."
Hemisphere's most recent success has been its Tavern Grill concept, which now has three locations in Edina, Blaine and Woodbury. That third site once housed the Aperitif restaurant, which closed in 2011 with the bankruptcy of St. Paul developer Jerry Trooien.
Ansari said one of main reasons he bit on the space was due to a major recent restaurant trend -- the patio craze, and the Woodbury site had a 5,000-square-foot outdoor deck to work with.
"The patio phenomenon has gotten bigger and bigger for us," he said. "Those tables are occupied from 11 a.m. to 1 a.m., without a stop. People like to take advantage of those few nice days that we have here."
Don Jacobson is a St. Paul-based freelance writer.