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Mixing It Up

From large mixed-use developments and mini-cities to newly created downtowns and food halls, restaurants now have a range of locations to choose from when considering opening a new space

by Kenna Simmons

The Canteen

The Canteen mini-food hall in Midtown Atlanta

It’s a national trend that’s going strong in Georgia: the rise – quite literally – of mixed-use restaurant-and-retail developments. The home-grown flavors include everything from hip urban spaces like Ponce City Market to suburban mega-developments like Avalon in Alpharetta to redeveloped or newly created “downtowns” like Parson’s Alley in Duluth. Add an urban take on it with food halls like Krog Street Market, and you have a wealth of opportunities for dining, shopping, working and playing.

In some ways, it’s a case of back to the future – in small towns and big ones, people used to head downtown to shop and dine. Although these developments don’t have the history that old downtowns have, they do consciously aim to create a sense of place and shared experiences.

The Counselors of Real Estate (CRE), an organization of real estate professionals, named “experiential retail” as one of its top 10 issues affecting real estate in 2016. It found that “mixed use experiences – such as a hotel/restaurant/sports (bowling) combination in addition to traditional stores—are growing.”

“We all want to drive less. We’re all moving back into cities,” says Steve Palmer, managing partner and founder of Charleston-based hospitality and consulting group Indigo Road, which opened two restaurants in Avalon. Palmer grew up in Atlanta and says he was skeptical at first of considering Avalon as the site for the Atlanta location of Oak Steakhouse (the original is on Broad Street in Charleston) and its sister restaurant, Colletta, which serves casual Italian cuisine. “In Charleston, we’re definitely intown restaurant people,” he says.

But the fact that Avalon is like a mini-city helped lure Palmer and his team out to the ’burbs. The 86-acre development includes more than 80 acres of offices, shops, restaurants, a movie theater and more than 600 dwellings – and a hotel and conference center in the works for 2018. It also has diverse offerings from some of Atlanta’s top restaurateurs, including Ford Fry and Shaun Doty.

“We all crave feeling like something is authentic,” says Palmer. “I think where mixed-use developments can go bad is when it feels a little cookie-cutter.” But North American Partners, which developed Avalon, offered “something that isn’t in every mixed-use development” by focusing on unique food and beverage offerings, he says.

Avalon has done something right, because other similar projects are coming out of the ground around the state. Take Halcyon in Forsyth County, 30 miles north of downtown Atlanta. The $370-million project promises a mix of restaurants, retail, office space, two hotels, a dine-in movie theater, nearly 700 residences and greenspace. Restaurants such as Feed Fried Chicken + Such, Gu’s Dumplings and Butcher & Brew have already signed on for restaurant space.

Know Your Neighbors

Palmer goes out of his way to praise North American Partners, saying they “delivered on everything they said they were going to do. In real estate development, that is a very rare thing.” In fact, he’ll be working with them again as a consultant for Main & Main, a food hall opening in 2019 in a revamped Colony Square in Midtown Atlanta. Indigo Road will also open two spaces in the food hall: Sukoshi, serving fast-casual Japanese, and Central Bar, serving drinks.

That doesn’t mean there weren’t challenges at Avalon, like opening the entire development on a single night. (It was mobbed.) And Palmer said he did a lot of homework – looking at the mix of restaurants slated for the development, but also at the broader tenant mix. That’s critical in a mixed-used retail environment, where you’re surrounded by other establishments with little or no space in between. Palmer didn’t want to be next to a lot of national chain restaurants.

“I love my restaurants very much,” he says. “If they’re going to be in a development with a bunch of other restaurants, I want them to be aligned. Even the retail stores mattered to me. The fact that Lululemon was there was a plus, because I believe that person is probably craving independently owned restaurants.”

Having Whole Foods as an anchor also helped, particularly since the store has a cooking school and chefs from Oak and Colletta participate. In fact, Palmer says that chefs from Avalon restaurants do a number of outdoor events.

“When you can create that kind synergy, I think it’s the best of a mixed-use development world,” he says.

Palmer’s biggest piece of advice to anyone considering locating in a mixed-use development: Pay very close attention to who your neighbors are going to be. In Avalon, because of its size, he was able to choose single buildings for Oak and Colletta. “That felt good to me,” he says. “It’s just what I’m used to.”

Mixed-Use Drives Traffic

Taqueria del Sol

Taqueria del Sol Interior

Atlanta’s popular Taqueria del Sol currently has five locations (including one in Athens) and is planning for a sixth, located in the Larkin on Memorial, a 63,000-square-foot adaptive re-use project across from Oakland Cemetery. Developed by the partners behind Krog Street Market, it will feature restaurants, retail including an Ace Hardware, and a Primrose School. (Leasing was still in progress at press time.)

The Larkin was attractive because the area, Atlanta’s Grant Park neighborhood, is picking up but isn’t overserved, says CEO and co-owner Mike Klank. While the Larkin on Memorial is under construction – tenants will begin to open their doors later this year – the Taqueria del Sol team helmed by Klank and founding Chef Eddie Hernandez, recently opened another location in Chamblee. The restaurant is located in Peachtree Station, a small shopping center anchored by a Whole Foods that includes several restaurants as well as a Cook’s Warehouse. It was a good fit for Taqueria del Sol because of the location and the clientele.

“There’s just a lot going on up there, both from a lunch and dinner standpoint,” says Klank. “We need to have both in our economic model.” The restaurant can draw from customer bases that include people who work in the area and people who live there – in this case, the two don’t always overlap.

He admits that when it comes to site selection, the team tends to “go by our gut rather than doing a lot of demographics.” But like Indigo Road’s Palmer, he points to the importance of having synergy among the tenants – or even the establishments nearby. Being in a mixed-use development increases the traffic coming by the restaurant.

But if there’s not a good match – well, Klank compares that to buying a house and not liking your next-door neighbor. “It changes your quality of life,” he says. “So if you don’t get along with your neighbors or they’re not drawing the right clientele so you have synergy, the result can be negative. If your guests don’t want to be around the people who are [visiting another establishment], it can stop them from coming to your business.”

Food Halls Encourage Experimentation

The Canteen Micro Food Hall

The Canteen Micro Food Hall opened this summer in the Tech Square area of Midtown Atlanta

Ben Johnson, Jennifer Johnson, Chef Todd Ginsberg and Shelley Sweet, all partners in The General Muir in Atlanta, weren’t looking to open up a restaurant in Krog Street Market, in Atlanta’s Inman Park neighborhood. It was just bad timing – The General Muir had recently opened, and the team wasn’t in a position to take on another venture. But the idea was really intriguing.

“One of the things we like to look at is which places add value to the city as a whole,” says Ben Johnson. “Where would we like to go, or take visitors?”

Krog Street, the first food hall to open in Atlanta and adjacent to the city’s BeltLine, fit the bill. So when the timing for Krog Street’s launch changed, the team wound up opening not one but two restaurants there: Fred’s Meat & Bread, a sandwich counter service, and Yalla, a Middle Eastern food stall, right next door.

While the restaurants have garnered great reviews from the start, there was a learning curve – although there was a counter service component at The General Muir, the team was more used to full service. Counter service for a full menu was different.

“We had to think about it more like a drive-thru, almost,” Johnson says. “How do you get people through the line? How do you design your menu in a way that allows you to maximize your speed?”

The issue was particularly acute at Yalla, because the plan was to build the order as the customer went through the line, but people weren’t as familiar with the Middle Eastern menu. They had questions.

The team quickly put employees on the line to hand out menus and answer questions before people got to the counter, which helped. But it also took a look at the menu.

“It’s still customizable, but now we [say], ‘Here’s how we would present these dishes,’” says Johnson. “We streamlined the process. If you want to change things up, that’s fine – rather than putting the responsibility entirely on the customer to build their dish as they went.”

One of the great things about a food hall, says Johnson, is that you can really focus your menu and not worry about having options for everyone. “The liberating thing is that you can specialize,” he says. “You can really work your niche.”

Other lessons from the food hall: Space is at a premium. Fred’s and Yalla are 1,000 square feet, total. The manager’s “office” is a shelf. “Your layout has to be really efficient in terms of equipment,” says Johnson. “It’s almost like thinking about a submarine.”

One unexpected benefit is that it’s provided a way to develop talent internally. “We’ve got somewhere to move young managers who may be ready for more responsibility, but it’s not as large as the full-service restaurant,” Johnson says. And it’s a good place to experiment with menu ideas, too.

The team learned so much that they’ve opened their own micro-food hall, The Canteen, in Midtown Atlanta. It includes another location of Fred’s and Yalla, plus TGM Bagel and Square Bar. They decided to keep it all in the family, so to speak, because the building is small (4,000 square feet) and they had four concepts ready to go.

Other food halls are popping up around the city, including the recently announced Marietta Square Market. Its proposed 18,000 square feet of space would accommodate three anchor restaurants and eight smaller (400 to 800 square feet) concepts.

Main & Main in Colony Square will be slightly larger – 28,000 square feet – with more than a dozen concepts, an outdoor gathering space called the Grove, space for a culinary incubator and a staging area for culinary programming and pop-up events. Both concepts are expected to open in Spring 2018.

The “mini-city” springing up in Forsyth County, Halcyon, also includes a food hall as part of its concept. The cities of Snellville and Alpharetta are also hoping to get into the food hall game and are in the early planning stages of bringing a “Krog Street-like” market to their towns.

Standalone Vs. Mixed-Use

Opening a restaurant in a mixed-use development or food hall instead of a standalone location is a different experience, these three restaurant veterans say. That’s true of things from parking to who wipes tables.

A food hall may hold an advantage for a small restaurant, because rent will be much less than what a full-service build-out would cost and you don’t have to worry about staffing to clean tables or restrooms, or manage the dining room.

“You’re basically outsourcing a lot of what are normally restaurant functions,” says Johnson. “The flip side is, your common area of maintenance costs are higher.”

In a mixed-use development, that’s something owners of standalone restaurants may not be used to. “You’re paying for your grass to be mowed and your sidewalks to be cleaned,” says Johnson. “There are inherent costs in a development like that, but there’s also inherent foot traffic. In the restaurant business, we all want to be where there’s a lot of people. It’s a give and take.”

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