Facing rising rents, top restaurants choose to say goodbye

Nobu, Union Square Cafe to relocate in coming months

New York /
Sep.September 07, 2016 10:41 AM

I’d like the lobster, but without the $3,000-a-foot rent, please.

A number of famous Manhattan restaurants are moving to new locations in the coming months amid ballooning retail rents, according to a report.

“The only way we can stay in the game is in a place where we can do a bigger volume,” said Drew Nieporent, who co-owns Nobu restaurants in the city.

Nobu will move from its Tribeca space to the Financial District in early 2017. Meanwhile, the Four Seasons Restaurant has left RFR Realty’s TRData LogoTINY Seagram Building and is set to relocate to Nearby 280 Park Avenue. And Danny Meyer plans to Reopen The Shuttered Union Square Cafe On East 19th Street, not far from its former home.

Restaurateurs looking to renew their long-term leases today may face rent increases by as much as 300 percent, the Wall Street Journal reports.

Moving has its challenges – the Nobu move cost several million dollars, according to Nieporent — and some regulars may be miffed about a new location. But restaurateurs say it is worth it if rising rents make it harder to stay profitable at an old location. Both Nobu and the Union Square Cafe will reopen in larger spaces, which their owners hope will lead to more revenue.

A relocation also offers the chance “ to generate interest all over again,” according to Stacy Gilbert, who co-heads the restaurant consulting practice at accountancy Citrin Cooperman.

The Real Deal recently reported that rising retail prices and asking rents have some observers worried about a bubble.  [WSJ]Konrad Putzier


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