Will Casual Dining Get Hit Next?

We’ve seen conflicting reports lately on the state of casual dining.

The most recent article reports on a Friedman, Billings, Ramsey analyst note earlier this week that said California Pizza Kitchen, Cheesecake Factory and P.F. Chang’s China Bistro will all face negative impacts from housing woes in Arizona, California and Florida, as consumers in those states cut spending.

But another report just last week had a Raymond James analyst upgrading Brinker International, P.F. Chang’s and many other chains. Analyst Bryan C. Elliott said demand in the sector is stabilizing, and many casual-dining chains could have better-than-expected results.

So what’s the real story?

We’ve all read plenty about rising food costs. Plus, consumers with tighter wallets because of the downturn in the economy are said to prefer quick-service venues and grocery-prepared items to casual-dining fare as of late.

Has all of this been overblown, and are we soon going to see these experienced restaurant operators bounce back? Or will problems in the economy mixed with high food costs and rapid real estate expansion lead to future restaurant closings?

Advertisements

5 Responses to “Will Casual Dining Get Hit Next?”


  1. 1 Nancy Hamel March 28, 2008 at 1:02 pm

    Everything we hear about lately has to do with housing woes, foreclosures, overwhelming credit card debt – whether you are in the midst of financial difficulties or not, the message is very clear – DON’T SPEND MORE THAN YOU HAVE TO. And even though I’m not in one of those situations, I have pulled in the reins to make sure I don’t end up there. One of the first things to go was eating out. So I would say yes, casual dining is in line to suffer until the economy (and the news) gets better.

  2. 2 Ladislao March 29, 2008 at 3:21 pm

    In response to NANCY HAMEL. Nancy wrote on a similar blog “Don’t Like the Price? Just Haggle”:

    “Personally, I can’t stand to haggle with anyone over price…except cars…that’s a sophisticated haggling game, conducted with dignity in a little office with the full understanding that the price on the sticker is baloney. I have never heard of anyone haggling the sales person in a Best Buy, Walmart, or Target, so it seems like this must be a newer phenomenon. Does this mean we all have to turn into that annoying person who complains too loud in the restaurant, or hotel lobby and embarasses everyone around them? Terrific. I can’t wait to be the one in line behind them…. If that is where we are headed, then obviously those who don’t haggle will be (and already are) paying higher prices to compensate for those who do. These “discount” stores who claim they have the lowest prices anywhere should truly put their lowest acceptable price on the sticker and tell the hagglers to take their business elsewhere.”

    THEN SHE WRITES THIS:

    “Everything we hear about lately has to do with housing woes, foreclosures, overwhelming credit card debt – whether you are in the midst of financial difficulties or not, the message is very clear – DON’T SPEND MORE THAN YOU HAVE TO. And even though I’m not in one of those situations, I have pulled in the reins to make sure I don’t end up there. One of the first things to go was eating out. So I would say yes, casual dining is in line to suffer until the economy (and the news) gets better.”

    Actually that almost comes across as a DOUBLE STANDARD, doesn’t it? Why doesn’t Ian Ritter write a topic on the “DOUBLE STANDARD LADY” – Nancy Hamel. If we listen to her advice, then we would never be able to go out and ask for a better price on something we want to enjoy; like say eating. We’ll probably become the “HOMEBODIES” she wants us to be and then she will get what she’s probably ALWAYS WANTED – to be the ONLY ONE in any retail business or restaurant buying and eating stuff. Actually I’m NOT Sorry to pick on you like this Nancy because I’m just using the same strength of wording as you did on both of Ian’s blogs. By the way that’s going to cost you FULL RETAIL price… LOL

  3. 3 Dealmaker March 31, 2008 at 8:33 am

    Casual Dining was hit first. Previously approved deals started dying in the 3rd Q of 2007. Sales flatlined. Entire RE deptartments were eliminated. New deals are years away now…But lets be honest…lots of these guys took cheap money and opened restaurants in places that made no sense at all. This one will take a long time to correct. More cheap money won’t solve their problems.

  4. 4 Mike Corbitt March 31, 2008 at 10:13 am

    I had three QSR’s and and one fast casual lined up to sign leases in the center I manage.The three QSR’s are still happening and the fast casual went with a franchisee instead of a corporate deal which we didnt like but accepted.I think the A locations will be fine it is the B and C centers that will really get hit hard.My own family of 5 will cut back a bit and instead of that $80-$100 sushi lunch we will get it down to a $40….probably at one of those QSR’s.

  5. 5 Matthew May April 1, 2008 at 8:41 am

    I am leasing multiple restaurant sites on the water in Marina Del Rey.
    I have found that Cheesecake Factory is cutting back expansion from 21 units last year to 8 for this year and for 2009. Most dinner houses are slowing down substantially and are now asking for more T.I. money from the developer. We have had strong interest from the steak house
    chains, both regional and national as well as some of the Darden Group concepts.

    In regard to the slowdown by Starbucks, The Coffee Bean & Tea Leak has let go of 30 employees and cut back their expansion plans substantially. Maybe the time is right now for Dunkin to expand?

    Matthew May
    MAY REALTY ADVISORS


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s




Subscribe
Bookmark and Share

Archives

March 2008
S M T W T F S
« Feb   Apr »
 1
2345678
9101112131415
16171819202122
23242526272829
3031  

Ian Ritter on Twitter

Error: Twitter did not respond. Please wait a few minutes and refresh this page.

RSS GlobeSt.com’s Top Stories

  • An error has occurred; the feed is probably down. Try again later.

%d bloggers like this: