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This page contains a single entry from the blog posted on September 21, 2012 10:11 PM. The previous post in this blog was Have a great weekend. The next post in this blog is Last cocktail of summer. Many more can be found on the main index page or by looking through the archives.

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Friday, September 21, 2012

There's no mystery

Mainstream restaurants are folding left and right in downtown Portland. And cheapo-cheapo food carts are multiplying. Coincidence? Of course not. It's a race to the bottom.

Comments (25)

bizjournals: The economy is a big reason. Even the best locations don’t pencil out if business doesn’t support the rent and rising food costs.
JK:
1. High land values are one of Metro’s goals to make high density “pencil out.”
2. Rising food costs are partly due to government policies taking 40% of the corn crop for biofuels.
3. Shootings in downtown as urban renewal takes money from police.

Looks like bad government policy is at least partly responsible.

Counting down to the great Portland Planner inflicted, meltdown
JK

Chain restaurants are hardly in style these days, especially in Portland. Something to consider.

What does "full venting" mean?

Food carts caused Macaroni Grill to close? You can't be serious.Try crappy food at high prices.

I disagree with you on this one Jack. And I think the Biz Journal article has got it wrong as well.

This topic brings up a lot of really interesting points concerning the changing dining values of middle-class eaters, not just in Portland, but in the greater country as well. The food scene (meaning brick and mortar restaurants) is alive and well in downtown Portland. What is not alive and well are places like Macaroni Grill, Stanfords, etc...places that charge higher than average prices for mediocre to good entrees "dressed up" in order to seem worth their value. This has nothing to do with city politics. It has to do with the rise of networks like Food Channel and Travel Channel dedicating major airtime to shows that feature smaller, local out-of-the way places instead of the big corporate chains that have routinely occupied the staid downtown blocks of any downtown American city for decades. Tourists aren't coming here for Macaroni Grill. People from the suburbs aren't driving into downtown for a steak at Ruth Chris. If people are going to spend money eating out in the city they want to the experience to be somewhat brag-worthy and unique. Suburbia has become discerning. Everyone knows the name Anthony Bourdain.

Just because a few big familiar restaurants bite the dust doesn't automatically mean they were forced out by government. Wealthy idiots in the private sector can run a perfectly good businesses into the ground just as fast as any bureaucrat can (and spend more money putting people out of work too). And that goes for food cart operators as well. Those things fail all the time.

While there are many aspects of Portland to which the "race to the bottom" label can be appropriately applied, the restaurant industry is not one of them.
The amount of brick and mortar restaurants doing interesting and affordable things with food and drink in this town is overwhelming for a place of its size.

There is no common thread for Macaroni Grill, Lucier, 12 West and McCormick & Schmick, and certainly none that touches food carts or city governance. Good local restaurants with sensible business plans are thriving and expanding: just check out Little Big Burger, Tasty & Sons, Salt & Straw or Bamboo Sushi to name a few. Also consider that the restaurant business is pretty much a zero-sum game, in that new stores, to succeed, have to capture part of the existing market. No new restaurant will make more people eat or make people eat more, so growth over all is pretty much limited by population growth.

Full venting means the exhaust hoods and canopies are in place and permitted. They are amongst the single most expensive, and notoriously difficult (permitting, fire department, etc) things to put into a restaurant. Having them in place can save upwards of $200,000.

Wealthy idiots in the private sector can run a perfectly good businesses into the ground just as fast as any bureaucrat can...

Amen to that! After 30+ years in the business, I can attest to it. And it's something I wish more people would recognize when they insist the private sector can do anything and everything better than government. There's plenty of ineptitude to go around.

Full venting is also a good description of this blog.

Thank you, canu, for the details around full venting.

Now if somebody could clue me in on who is Anthony Bourdain, the removal of my ignorance will be complete. Bonus points awarded on why I should care about knowing him.

Because chains closing in Portland has nothing to do with the higher quality and much better tasting food that locally owned places can provide at the same, or lower, price point.

When you start calculating how much revenue per a dollar stays in Oregon (Portland) vs. being sent out of State in locally owned vs. Chains, I think you of all people would be championing the local guys.

Macaroni Grill couldn't compete because the food tastes like it was literally taken out of a box and microwaved. When there are three Italian places within a mile that serve fresh food with fresh ingredients, one of which has a James Beard (or some similar prestigious) award winning chef attached to it... where do you think people would rather go?

For that matter there are four Italian places out in my neck of the woods that I would have rather gone too. Macaroni Grill, much less driving (or Biking, or taking MAX,) downtown didn't even ping on the radar as a destination when the food for spaghetti came upon me.

Mood not food in the last sentence.

"Mainstream restaurants" are more than restaurant chains. I know of many long established, well run restaurants having unfair competition from food carts. When you're down by over $300,000 providing for all the codes, bathrooms, parking and all, its hard to compete with a wok.

My theory?

Even in Portland, there is a finite number of people willing to pay $ 17 for 50 cents worth of pasta...more than once. And a small portion at that.

And I don't much care how much the restaurant had to pay for their vents. I vent on Yelp... and here.

In response to Ex-bartender, when a private sector business fails, the owner loses money. When government loses money, the taxpayer loses money.

Vitaly Paley will be the exception to this theory.

"when a private sector business fails, the owner loses money." Usually along with a bunch of other people including landlords, suppliers, sometimes employees, utilities etc. Many restaurants that go out of business leave a whole bunch of people stiffed.

"2. Rising food costs are partly due to government policies taking 40% of the corn crop for biofuels."

Hmmmm....keep in mind that (at least until this year's drought) that corn yields are up. Way up.

Ethanol production takes cow food (field corn, not stuff you eat), adds water and natural gas to yield ethanol and cow food (distiller's grains.)

Soybean price is up around $16.50/bushel so plan on higher food prices not related to ethanol. That would be worth a separate analysis.

In any case, I suspect that failed restaurant problems aren't related to the price of wholesale restaurant supplies and food.

The amount of brick and mortar restaurants doing interesting and affordable things with food and drink in this town

Not downtown.

many long established, well run restaurants having unfair competition from food carts.

Exactly.

...when a private sector business fails, the owner loses money. When government loses money, the taxpayer loses money.

Like when those "too big to fail" financial institutions all went out of business? Don't make me laugh. Or perhaps we can keep it local: when I filed for unemployment from my last employer, I found out they hadn't been paying payroll taxes, workers comp, UI or SS for their workers. Who do you think is eating that? They sure aren't.

todays story in the fish wrapper about Rockwoods problems really made me laugh when they said one of the main problems in Rockwood is they only have one food cart!!!One other thing with failing restaurants dt is there is much,much less people working dt now compared to a few years ago, and they are by and large goverment workers.Even the food court in pioneer square is half as crowded as it use to be.

Now if somebody could clue me in on who is Anthony Bourdain, the removal of my ignorance will be complete. Bonus points awarded on why I should care about knowing him.

Harry, we can assume you know how to look stuff up, right? That being the case, we can also assume that you are flaunting your innocence of any knowledge of Anthony Bourdain. The question that's naggine me is, why?

Also consider that the restaurant business is pretty much a zero-sum game, in that new stores, to succeed, have to capture part of the existing market. No new restaurant will make more people eat or make people eat more, so growth over all is pretty much limited by population growth.

The one exception to that might be Yaw's Top Notch which just reopened in outer NE after about 30 years.

I really think that they have pulled some older people into the restaurant that don't normally eat out.

Am I the last person alive who actually *likes* to eat at chain restaurants? I love me some Red Lobster and I also enjoy Applebee's. Why does everyone online act like that is sacrilege?

"Am I the last person alive who actually *likes* to eat at chain restaurants? I love me some Red Lobster and I also enjoy Applebee's. Why does everyone online act like that is sacrilege?"

You should change your name to TacoBELLDave. :)

I think Red Lobster is awful and Applebee's just merely bad. But Atul Gawande (doctor and New Yorker contributer) wrote a piece in a recent issue about how medicine would be better run if it were managed like a GOOD chain restaurant. He cited The Cheesecake Factory as exemplar of a restaurant that produces superior food with great efficiency and quality as well as cost control

Few or none of the great ideas I read for reforming or improving medical care or costs ever come to any fruition, including the "Affordable" Care Act. But I would love to run across a Cheesecake Factory!




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