2A — September 17 - October 21, 2021 — M id A tlantic Real Estate Journal


M id A tlantic Real Estate Journal

M id A tlantic R eal E state J ournal Publisher, Conference Producer . .............Linda Christman AVP, Conference Producer ...........................Lea Christman Publisher ........................................................Joe Christman Editor/Graphic Artist ......................................Karen Vachon Contributing Columnist ....Paul G. W. Fetscher CCIM CRX CLS, Great American Brokerage Mid Atlantic R eal E state J ournal ~ Published Semi-Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal 350 Lincoln St, Suite 1105, Hingham, MA 02043 USPS #22-358 | Vol. 33, Issue 8 Subscription rates: 1 year $99.00, 2 years $148.50, 3 years $247.50 & $4.00 single issue - plus postage REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion Phone: 781-740-2900 www.marej.com

By Paul G. W. Fetscher, CCIM CRX CLS

Where Does Foodservice Go From Here? s you know, there h a v e b e e n ma n y changes to the restau- rant industry over the past few years. In 2015, the wage for a tipped employee was $5 per hour. That has now been raised to $12.75 and headed towards $15 per hour, a 200% increase. At the same time, meat prices are up over 20% in the last year. Insurance rates are up 35% - 40%. While the costs of doing business have raised substantially, the actual Cost of Living 2010 – 2020 has only gone up 1.67% compounded. Needless to say, the ability to pass the costs on to the consumer have not kept pace with the rise in operating costs. This past year brought gov- ernment mandated limited service if any. Many operators successfully pivoted. Some became grocery delivery services. Delivery of alcohol was one bright glim- mer of hope in a challenging landscape. Some landlords A

were understanding and bent their expectations. Others drew a line in the sand and demanded full rents; even when operators were prohib- ited from serving their dining room guests. I suspect there’s going to be a very long line at the Land- lord Tenant court. Of course, it’s better to reach an equitable agreement at the negotiating table. But some landlords will remain intransigent, and wind up losing tenants. Restaurant operators have fallen into four categories. The first of these is “Grab and Go”. Bagels, Pizza and even some Taco operations fall into this group. They may be down 10%

- 15%. Others are even UP in sales. They can tighten their belts and they are far from devastated. The second group is the Fast Casual. If they are dependent upon lunchtime office trade, they may be down 20% - 40% due to the people who aren’t going to their offices. Many of these have pivoted well with Third Party Delivery services. Others are suffering the ravages of devastated of- fices. I understand that 40% of all office space for lease in Manhattan is available on Sublease. Many offices have found that working at home cuts down on commuting, and continued on page 28A

Firmly Rooted in the Law and in the Community We are well grounded in every facet of real estate law, from acquisition to construction. We are committed to serving the needs of our clients and our communities.

Contact: NEIL A. STEIN • nstein@kaplaw.com 910 Harvest Drive, Blue Bell, PA 19422-0765 • 610-941-2469 • kaplaw.com Other Offices: • Cherry Hill, NJ 856-675-1550 • Philadelphia, PA 215-567-3120 Kaplin Stewart A t t o r ne y s a t Law

Made with FlippingBook Online newsletter maker