“The Roaring 20s after the 1918 flu will be more like 2023 and 2024.”

Seasoned commercial real estate broker John A. Asadoorian says the restaurateurs with futures in D.C. recognize we’re not going back to the before times once the coronavirus pandemic lifts. “The longer we went through the period of uncertainty, the more separated we became from the momentum of the market before COVID,” says the Southeast D.C. native and founder of Asadoorian Retail Solutions. “The people who are going to last are people who understand this is a new market. It’s a new economy.”

Asadoorian represents both restaurants and retailers looking to set up shop and landlords marketing their spaces to tenants in the most competitive neighborhoods in the city. He can make educated guesses about the future of D.C. dining with the caveat that the uncertainty of the pandemic still clouds predictions. “There are a lot of smart people out there who are smart enough to realize we know nothing,” he says. “We’re all suffering through changes no one anticipated.”

In his 35-year career, Asadoorian has weathered three resets following economic hardships—a recession in the early 1990s, the aftermath of 9/11, and the 2008 Great Recession. When the District emerged from the latter, D.C.’s 12-year restaurant renaissance began. “It was a proverbial fire hose we were drinking from,” Asadoorian says. “If you didn’t open a restaurant at Union Market, Capitol Riverfront, the Wharf, or 14th Street [NW], you were going to miss out.”

During this period, he says “everyone who knew how to eat food” set their sights on owning a restaurant. “Just because you were a sous chef with a tattoo and a cool story, you could open a restaurant and be successful,” he says. “Or, just because someone took pictures of your food and put it on Instagram, you were successful.”

People passed around small plates with abandon. Chefs “elevated” common fare or made fancy food “approachable.” Cocktails arrived at tables smoking from liquid nitrogen. Edison bulbs cast broody light inside speakeasies with websites. Servers shared chefs’ life stories. Blistered shishito peppers sustained the happy hour crowd. Restaurateurs planted “concepts” down alleys. A meal was “an experience.”

In this crave new world, some diners became accustomed to chasing tables at the hottest restaurants. They worked their way down a checklist and documented their conquests on social media. Dinner was way more than sustenance.

“That habit was broken when the music stopped,” Asadoorian says. “People now are less accustomed to going out to be entertained because they’ve been eating at home. They’ll come out in droves once they can because they’re bored, but they may not go out the same way.”

When D.C. fully reopens, Asadoorian predicts diners will be more discerning and may visit restaurants helmed by chefs they love more often. Where loyalty was fleeting before, the pandemic spurred Washingtonians to step up and support the restaurants in their neighborhoods to ensure their survival. Not all of them made it and more closures are expected once the District’s eviction moratorium lifts. “There’s going to be fewer restaurants, but they’ll be better,” Asadoorian hypothesizes.

City Paper spoke with local restaurateurs hoping to expand their existing portfolios and become a bigger part of D.C.’s post-pandemic restaurant scene. They’re quoted anonymously as chefs and owners don’t often disclose what they’re cooking up until leases are finalized. While their insights contain clues, their experiences cruising for commercial real estate are vastly different making it tricky to draw conclusions.

A restaurateur we’ll call Drew just turned down a generous deal from an international developer with a few buildings in D.C. The property owner offered to fund the build out of the restaurant and only collect a percentage of the restaurant’s sales until the construction costs are repaid. Then the restaurant would be on the hook for more standard rent payments.

“The biggest problem for landlords is there are a ton of properties, but not a lot of access to capital for restaurateurs,” Drew says. Absent significant aid from the federal government, the pandemic bled many restaurant owners dry. “Everyone’s gotta figure out interesting ways to get deals done because so many properties are sitting empty.”

According to Drew, some landlords share an asking price and, in the next breath, say they’re willing to go down by almost half. “If you have access to capital right now, Jesus Christ, this is the time,” Drew says. “Fifteen or 16 properties have approached me on social media. The new way to reach out to a tenant is on fucking Instagram!”

Drew surmises they’re being courted heavily because they have “such a proven concept that’s working in this environment.” Landlords, Drew says, are seeking sure things. “If I was a fine dining Georgian concept, no one is going to take a bet on that … There are going to be less esoteric concepts opening for a year or two, which is a shame.”

Asadoorian calls this notion an overgeneralization. “Whether it’s a banker lending money, a broker spending time with a client, or a landlord, they’re going to look for someone with a business plan that works,” he says. If you’re looking to open “a gluten-free Cambodian restaurant that specializes in vegetarian food,” for example, the landlord will want to see air-tight financials. “They’re not going to be rude, but they’re going to look at it more closely.”

He says the risk calculation for boundary pushing, untested restaurants has changed since the pandemic. “A year ago, [landlords] would say, ‘Sounds cool! Edit Lab’s designing it? You’ll pay twice the market rate? Done!’ Now, people are going to be like, ‘I really like you, but I don’t know if that business makes sense.’ It’s not so much that I don’t think people will eat that. People are still going to want authentic and unique. If you have real skills and a business plan that makes sense, there’s still opportunity for that.”

Source