Drew Nieporent: Of Landlords, Leases, and Lamentation

By JULIETTE ROSSANT Earlier this month, as Bryan Miller of the New York Observer reported, New York food restaurateur Drew Nieporent, head of the Myriad Restaurant Group, held a weekend seminar on the Restaurant industry, entitled "How to Open a Restaurant - and Make It Last" and targeting prospective and current restaurant owners to the tune of some $1,000. The statistics cited were unsurprising: four out of five restaurants close in their first five years. More importantly, this seminar stated time and time again that a restaurant's success has little to do with food and much about real estate. That's right: read my virtual lips: it's mostly about Real Estate. Classically, according to Drew & Co., landlords prey upon captive tenants: once a restaurant makes it, they demand they either pay more or move out. This is called "market rent" revaluation: "�Market rent� is simply the highest price some schmuck will pay." During his talk, Drew shared a telling personal experience regarding the Rainbow Room. When the restaurant became available a few years back, leaseholders approached him to take over the property -- for a mere $4 million a year. "I calculated that, and it came out to about $10,000 a day." The veteran's reaction? "How would you like to drive to work every day looking at that?" One speaker, Gary Worden, publisher of Restaurant Startup & Growth Magazine, stated that of some 60,000 restaurants expected to open in 2004, equivalent to some 165 openings per day, one in four or some 40 restaurants will also close each day. Another speaker, Food Network chef Mario Batali, stressed customer service over TV marketing (and he's one to talk!) because "the average diner comes to a restaurant to interact with friends at the table. And the food. They don�t give a shit who�s cooking." Previous articles: Rocco DiSpirito: Ridiculed in the Rainbow Room More Reality TV Chefs (Or Less)? Molto Mario Massascres Mahi