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Sunday, January 21, 2007

Food for thought

Why are some restaurant spaces more difficult to keep occupied than others?

It's lunchtime on a Thursday, and Spoon on the Avenue, an upscale coffeehouse and sit-down restaurant that opened last January in this South Roanoke neighborhood, is closed.

The black canvas umbrellas in the front lawn are clammed shut, and silhouettes of empty tables and an unattended coffee bar can be seen through the restaurant's grand floor-to-ceiling windows.

Still, on this eerily warm January day, diners wander up its brick path, past the spacious lawn and give the door knob a try.

"I'm really surprised," said Jessie Swier, 82, after realizing it was closed for business -- indefinitely. She back-tracked down the path and headed next door to the small garage-like building set back from the road that houses Fork in the Alley.

Spoon on the Avenue had always appeared busy when she was there, she noted.

Last month, though, this cafe-style eatery situated in a two-story house joined a long-line of culinary ventures that fizzled out shortly after opening in this well-to-do Crystal Spring Avenue location. In less than six years, four restaurants have passed through its doors -- The Meeting House, Eric's on Crystal Spring, The White House, and most recently Spoon -- three of which closed in less than a year for different reasons. Meanwhile, it's next door neighbor, the less-visible but popular Fork in the Alley which, opened in spring 2005, has since cemented itself in as a neighborhood staple.

Spoon's fate also illustrates a wider phenomenon that has for years lurked around the Roanoke Valley, haunting places like the former Rabbit Patch Cafe, the late Bistro on Campbell spot, and even a prominent space on the Market Square formerly occupied by the Paradox restaurant, which had gone through several identities over the years and now is a gaping storefront undergoing renovations.

Despite highly visible and well-trafficked locations, these spaces for one reason or another have trouble making a business stick, begging the question, have they simply fallen into a pattern of bad luck, or is there something intrinsic about a spot that poses a challenge for newcomers?

Even downtown Roanoke with its mass of about 10,000 employees and 400 residents often is afflicted by high turnover rates at certain locales -- places where one business opens, sticks around for a couple of months and quietly disappears.

"I see a lot of things not make it and I wonder why," said Swier's 30-year-old granddaughter, Melanie, who was dining with her at Fork in the Alley that day. "I think it is kind of sad because it prevents Roanoke from growing, from attracting younger people."

The majority of these spaces are occupied by restaurants, but retailers occasionally move into these seemingly ill-fated locations, as well.

Some commercial business experts say that turnover at a reasonable rate is normal, even expected as a sign of healthy competition.

"It's the capitalist way," said David Diaz, executive director for Downtown Roanoke Inc., a nonprofit organization heavily involved with the revitalization of downtown. He noted that turnover among businesses in downtown has helped filter out those that lack staying power, opening up slots for newcomers and keeping the retail and dining options fluid with market demands.

According to the U.S. Small Business Administration, about a third of new businesses close within the first two years and a little more than half close within four years. Contrary to popular belief, the survival rate for restaurants and other types of eateries is about the same, said Brian Headd, an economist with the administration's Office of Advocacy.

Beyond location

Location plays a part, although both business owners and commercial real estate experts alike downplay its significance.

For one, the physical space -- not its geographic location -- can weigh heavily on startup cost, in effect raising the bar for any fledging business, Diaz explained. Older buildings, especially those found in downtown with their narrow, ground-floor storefronts, can be downright finicky and stubborn to change. The cost of rehabilitation -- such as replacing the wiring and adding ventilation -- can raise opening expenses beyond expectations, Diaz said.

Some aging buildings can't hold as many customers as the sprawling, newly constructed spaces near Valley View Mall, a limitation that can cut directly into profits.

"Even if you're doing pretty good sales, you don't have the square footage to make a living," said Roger Elkin, executive vice president of operations for Hall Associates, a commercial real estate company in the Roanoke Valley.

He noted that the former Rabbit Patch location in particular, while centrally located at the intersection of Jefferson Street and Campbell Avenue, lacks the floor space needed to make a sit-down restaurant profitable. Fitting the business to the space is crucial in making it succeed, Elkin added, noting that the corner-storefront may do better with a take-out place of sorts that can produce a high volume of transactions in a small place.

Then there are some commercial spaces that simply have trouble shaking a former tenant's reputation, said Darren Tristano, a vice president of Technomic, a Chicago-based research and consulting firm in the food industry. A perception of uncleanliness or poor service, earned from a previous eatery, may be enough to spook a new diner from giving it a try, he added.

Getting the right target demographic is also key, as is the pricing of the menu and fitting the tenor of the locale. Chain restaurants splurge heavily -- both in time and money -- when it comes to scouting out a location, Tristano added. Not only do they consider traffic counts, but also surrounding businesses or institutions to see if they'd support that type of restaurant in the area.

Product, presentation

Yet location is only one of many factors driving a business' success, said Diaz, adding that the creativeness of the owners and their ability to offer a unique product often trumps location.

"Look at Frankie Rowland's. It's a dark black window. You can't even tell what kind of restaurant it is," Diaz said of the upscale steakhouse that opened in 2001 on Jefferson Street.

Mismanagement, poor service and an ill-conceived concept can doom a restaurant or retailer, regardless of the location.

"You can have bad businesses in good locations," said Sands Woody, owner of Trio Bistro-Bar-Bottle, which is coming up to its one-year anniversary. Trio's location at the south end of Market Street also has a bit of a checkered past, first housing The Daily Grind coffee shop and the Great 611 Steakhouse, which closed in 2002. Then Beamer's moved into the space soon after, but closed in August 2004.

Spoon on the Avenue's closing, for instance, can be attributed to several factors, such as management changing hands too frequently and the restaurant having what he describes as a bit of an "identity issue" -- it was trying to be both an upscale coffeehouse and full-service restaurant, said its owner David Trinkle, a Roanoke doctor and the city's vice mayor, who opened Spoon in the former White House spot. Trinkle also owns the pub-style restaurant next door, Fork in the Alley, and the property on which both restaurants stand. Even he wasn't sure how two restaurants with a shared locale could have such different fates, describing it as a "conundrum."

Being in a home also creates some challenges, Trinkle said, referring to the smaller rooms and tighter kitchen space. "Most of us when we go out to eat don't want to eat in a room by ourselves," he said.

The fact that the restaurant was in a two-story house with a spacious front lawn and ringed by a white picket fence may have confused some potential customers.

"Maybe people think it's very expensive," said diner Kathy Shively, 52, when asked why she thought businesses had trouble surviving at the White House location. "Fork in the Alley looks more laid-back."

"It looks more like us," her friend, Shirley Smith, 49, said of Fork.

Shively later remarked that the Spoon building could easily be mistaken for a bed and breakfast.

For many restaurateurs, the fragile first year of a business opening is a notable hump to overcome, because in that window of time an owner is able to assess whether it will be profitable enough to cover its operating costs, Tristano said.

"People will not put up with bad service or bad food -- with people you get only one shot," Woody said.

When they do close, though, diners -- and the media -- tend to pay more attention, rather than focusing on the obvious success stories, such as Billy's Ritz and Corned Beef & Co., Woody added.

Success stories

To be sure, success stories do abound in downtown and elsewhere around the Roanoke Valley, where many restaurateurs exorcised the ghosts of failed businesses past.

The storefront at 112 Campbell Avenue -- a once difficult property to fill, Elkin said, because it long sat empty in a state of disrepair and posed some costly renovation challenges -- has housed the popular Mill Mountain Coffee & Tea without interruption for nearly 16 years.

Downtown is also gearing up for another round of openings -- the old Paradox restaurant location is soon to reopen as 202 Market, a new restaurant with a piano bar upstairs, live music and a gallery area.

A new Italian restaurant, Nico's, is opening in the former Italiano's space on Campbell Avenue, and Blues BBQ Company is moving into the building that once house Confeddy's on the Market Street.

Even the former Spoon location will soon go through another incarnation -- a new restaurant is scheduled to open there in February "that's got a fairly unique product that will fit well with the historic home," Trinkle said.

After all, one restaurateur's cursed location can easily be another's culinary destiny, says downtown newcomer, Sukasom NaSongkhla, owner of Tong's Thai on Salem Avenue in downtown Roanoke.

Prior to its opening, the two-story high space with a neon sign slung vertically down its facade was occupied by another Thai restaurant, the M Bistro, Chili Peppers and O'dells restaurant, in addition to sitting empty for many years.

NaSongkhla, who goes by Mr. Bond (yes, as in James), claims he took only about 10 days to complete the renovations, get his liquor license and open the restaurant in January 2006. Sitting in his restaurant recently, the end of the bar overflowing with spreadsheets and financial documents, NaSongkhla savored his good fortune.

"Everything worked out so easy," he said.

His face flush with excitement, NaSongkhla walked over to a cabinet, pulled out a stack of black poster boards and spread them out on a nearby table. Each board had photographs tacked to it with images of his latest expansion plan -- the opening of a second location on Franklin Road, called Tong's Thai Too.

It's at the spot formerly occupied by the Buck Mountain Grill and site of the short-lived, Southern-style eatery, Christopher's, which closed its doors about six months ago, less than a year after it opened.

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