Why are so many Boston restaurants closing?

Sometimes every of the restaurants in Boston seems to be closing.

L & # 39; Espalier, dance the screening screening menu and one of the best cheese carts at home. Surface Park in Faneuil Hall, hitting with Yankee cook for almost 200 years. Erbaluce, name the best Italian restaurant of 2018 at the Boston magazine. Cultivate, which gave farm-to-table sensibility to a central hotel. The advertisements give up a row, a series of gut pockets for those who care for food and small business health in this town. Why are all restaurants closing? Why now?

"OK, this is the money bullet. This is the right reason. Are you ready?" Bob Luz, president and CEO of the Massachusetts Restaurant Association said. "There's no reason for it. It's a lot of events, and it's getting the things we know there."

Of course, the obvious factors are: The rents are high and climbing, there are independent flavors, the business is very consuming. But the truth is that every closure is different, with its own special strain on factors that have never been recognized. Each restaurant has its own story.

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In the case of L & # 39; Espalier, cookie owner Frank McClelland said in late December with the Globe that he was finishing after 30 years of ownership because "the lease is up and there is no I wish to continue doing this and renew it "He was working on something new, he said.

Le Durgin-Park, the changing factors in the changing market and business of transfer business were the decision factors. Many of the reasons why Michael Weinstein, the chief executive of the Ark Restaurants parent were cited: an increase in the minimum wage, insurance premiums and other operating costs; Faneuil Hall reduced appeal for locals against enlarged Sea traction; the rise in home delivery and meal equipment; change flavors; Raise the price inability to balance equation.

"This is intense to close it," said Weinstein. "There are people who have been working there forever. We've probably managed to manage a lousy job. We thought that people did not want to change it." Efforts to cross the menu on the core program without attracting new customers , he said. And then shareholders had to think.

Restaurants Ark are going away from expensive markets such as Boston and New York, and it is important that it comes to places that are more business friendly, such as Alabama, South Florida, and Las Vegas. "I do not know how long I think to subsidize something so that people can recast," said Weinstein. "I've been doing it for three years, we want to show this, and our business profile is no longer bigger … If someone told me today, Durgin- Park available, you can buy it for $ 1, it would not be our business profile. "

Erbaluce, on the other hand, was doing a great deal when he closed, according to chef owner Charles Draghi: "We finished the top of our game, such as a retired athlete after Super Bowl, which Brady will never do. "

This closing is a development story. Draghi and partner Joan Johnson opened the Bay Village restaurant in 2008 with a 10-year lease and intends to buy the building. But the economy fell, and they did not get enough payment down together. In the meantime, 20 towers began to rise among the brick rides of a smallest neighborhood in Boston.

The new owner of the Erbaluce building is being redeveloped in condos. The building would like to remove a restaurant for two years, estimated Draghi, who would be able to return the beer and wine license to the city.

"If we wanted to come back, we have to get a full drink of a drink for half a million bucks, and we can not give it." Then rent may go up, and the function space that helped Erbaluce by eliminating slower periods.

Different closures, different stories. But what are all these restaurants in general than the market in which they work. Boston is a part of a problem. In 2019, the city is not always in small independent restaurants.

In fact, the number of restaurants closing is not more different than usual. The changing type of restaurant, says Tom Clark, is a restaurant development president and Ashling construction company. Places that close everyone's ears are closed. "It may be the high end," he says.

& # 39; If you're doing a good job, 95 percent of every dollar goes to pay costs. . . . Not everyone is doing well. & # 39;

Clark Ashling founded in 2003. "When we started we had a one-time chef. I would love to work for people like West Bridge," closing Cambridge's restaurant in 2015. "They were tackling all something in life savings. The kind of heart-and-soul, mother-and-pop. "

This year, for about 20 openings, it is a bit expected if anyone is independently owned. "It's not their restaurants, they do not have their money. People are building their places. Everyone in Boston does not think of a group of people who are in fact that there is not a thing that is in fact. Everything is a group. sometimes off on these leases. "

Rent is a huge tax. Michael Staub, a restaurant development consultant and a Group M Principal principal, said that if rents continue to grow at least 3 per cent per year, but there is no business income, then it can be difficult to keep a restaurant up.

"Customers look at rents as a percentage of sales not only for the size of the dollar. You want to be in the 6-8 percent sales area. Now it's closer to 9-10 percent."

There are also laboratory shortages in restaurants throughout the country, which are partly driven by low unemployment. In Boston, the vast number of restaurants, and the rate at which they are extortioning, have a worst problem: In the Port, alone, 59 new places have been opened in the last five years, according to the Luz of a Restaurant Association Massachusetts.

It is a constant struggle to keep operators on an adequate basis. The minimum wage is up, an explicit load: from $ 12 per hour to $ 15 by 2023, and from $ 4.35 to $ 6.75 for tipped employees. Indeed, Luz said that most of the restaurant employees are more than the minimum. Restoreurs and workers use the number as a measure: If it goes up to $ 1, there should also be wages.

"Over a nine-year period, the minimum wage will have gone from $ 8 per hour to $ 15 hours, when it is said and done. It's almost double," Luz said.

In a full-service restaurant, most employees are tipped. "The entire business plan for restaurants is built on two thirds of staff working on the minimum pay, and those with the highest wage." At a more casual place, they could make $ 25 hours, up to $ 50 hours, said: "That pay is up to 157 percent in that timeframe." There are also other new costs, related to medical care, sick leave and family leave.

Here's a business where the average profit margin could be 3 to 6 percent. "If you're doing a good job, 95 percent of every dollar goes to pay costs," Luz said. "Those who are doing well. Not everyone is doing really well."

All of these new restaurants mean a new level of competition. The city the population is growing, but not as fast as the number of places to live. This includes restaurants as well as prepared foods from the grocery store, meal equipment, and home delivery. (Light referred to as "the sheaf of the herd.")

He'll miss it on the Internet. Builders maintain a building, and they can not repeat their projects with a Record Tower or Borders or other commercial retailers have been lost commercially. But we can not get restaurant meals yet through Amazon – at least not yet. (Cue the drones.) All offices or condo The construction project brings more places to eat.

In the case of an entrepreneurial spirit, the restaurant business is easy to access. But it's easy to fail. "Anyone can get in, but it does not work well for you," said Staub. "The operators do not have a lot of experience than the business attitude to take this kind of responsibility."

There are many other factors that work: change politics, tourism, flavors.

"When Donald Trump got [elected], to cut our business in half. Most of our business is foreign tourists, and they are all threatening to the United States, "said Draghi." If I did another place, we would like to focus on prepared meals to go and some things. There are some good salads, a pile of pastas, a few soups. People want to eat simpler and lighter. The days of the white board restaurant are gone. "

Everything is far from gloom and sincere. Nationally, the industry saw the eighth month of its own growth, with sales of the same store up 2 percent in January, according to TDn2K, which is run by the service industry. Luz stated that the average number continues to eat more to eat than in: In the mid 70's, Americans spent 24 percent of every food dollar outside the home. This number is up to 52 cents today.

But if restaurants do not change, more endeavors will still come. "All stakeholders involved in restaurants – owners, staff, landlords, investors, customers – must understand that it is more expensive to work," said Staub. "Everyone has to reappoint their prospects for this business."

Devra You can first find devra.first@globe.com. Follow her on Twitter @devrafirst.


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