• Thu
  • Dec 25, 2014
  • Updated: 6:24pm

Storm clouds over restaurants

PUBLISHED : Wednesday, 22 October, 2008, 12:00am
UPDATED : Wednesday, 22 October, 2008, 12:00am
 

London

The sunny weather has gone and the autumn storms are sweeping in, adding to the economic gloom of what is shaping up to be a scary recession in the British capital.

The mayor, Boris Johnson, has called for calm, saying the negativity is making things worse.

Perhaps. But there is a palpable sense of resignation, a feeling of 'bring it on'. A friend, who recently gave up his gym membership, summed it up.

'I didn't go to the gym anyway - now I don't have to spend GBP55 [HK$740] a month for the odd sauna,' he said.

The gyms are going into overdrive. Independent gym Market Sports, in Shoreditch, is offering GBP5 off a month for every new member recommended. The Gainsborough gym in Islington now costs just GBP5 a week, if you commit for two years.

Gyms, it seems, are just some of the first victims in downturns. Jobs and house prices follow.

About 300,000 Londoners were now jobless, said London's Evening Standard, with the City bearing the brunt.

Property prices are falling, too, with property agency Knight Frank warning of a 30 per cent cut from last year's peak. The average London home has lost GBP30,000, with real estate agents selling on average just one house a week for each branch.

When house prices fell, restaurants, like gyms, found themselves heading for tough times. Mike Gottlieb, head of the Restaurant Association, said most restaurants were scared stiff.

He told the Standard: 'Londoners will still go out to eat but are less likely to chance anything new.'

As a result, chains are marketing aggressively.

The upside is more deals and vouchers, especially from new, expensive chains such as the Giraffe group, Yo! Sushi, La Tasca tapas bars, and Gourmet Burger Kitchen.

The attitude to the latter was summed up by a taxi driver I met last week. He loved Gourmet Burgers but found the cost hard to stomach.

Some outlets of the ubiquitous All Bar One pub chain are up for grabs, as is The Mongolian Barbecue chain, a branch of which, in Covent Garden, closed for refurbishment months back and hasn't reopened.

It is not just the chains suffering. Ubon, the upmarket Canary Wharf sister outlet of award-winning Nobu and part-owned by Robert De Niro, has already closed, along with its neighbour, Lehman Brothers, citing the high rent.

Such fixtures as Ed's Easy Diner in Soho and Smollensky's, below the Strand, are for sale.

Experts say only high-profile restaurants such as Gordon Ramsay's and The Ivy are sure to survive, as are 'restro-bars' such as trendy Hakkasan, which lure a young crowd.

Peter Harden, of the Harden's restaurant guide, said places appealing to a younger clientele will be OK, as such customers spend until they lose their jobs.

He told the Standard it was the mortgage-payers pulling in the reins, hurting highly geared family chains more. 'The best will be fine,' Mr Harden said. 'Recessions are like guidebook editors - they cross out bad restaurants.'

Shops are discounting heavily. There could be more bargains soon, too: the Westfield London Shopping Centre in Shepherd's Bush is about to open, offering 16 hectares and 256 shops, with 56 restaurants. 'Sublime timing for students of paradox,' wrote The Guardian.

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