VOL. 127 | NO. 34 | Monday, February 20, 2012
Before a restaurateur nails down a concept, builds a menu or begins the financing process, solidifying a location reigns supreme.
Eddie McGregor, left, owner of 2 Guys Catering, prepares meals while taking orders from customers. The restaurant is located on the second floor of the Morgan Keegan Tower.
(Photo: Lance Murphey)
The rule of thumb is especially prominent within Downtown Memphis, where many eateries are tucked away into office buildings and operate within hours that capitalize on daytime traffic and repeat business.
Just ask Edgar McGregor of 2 Guys Catering. McGregor is known as Chef Eddie Mac to his regulars and has worked in the hospitality industry his entire life. Though he’s only been housed on the second floor of Morgan Keegan Tower for a year, he has quickly adjusted to the perks of operating solely on weekdays from 8 a.m. to 2 p.m.
“I wouldn’t be in the restaurant any other way after experiencing this,” McGregor said, adding that about 90 percent of his clientele comes from within the tower. “It’s kind of like a hidden jewel essentially. Although the revenue stream isn’t as great as a 24-7 large operation, the quality of life that comes out of operating a building like this is way, way better.”
Instead of working 365 days a year as most restaurateurs do, McGregor works about 250. Plus he’s off for holidays.
“There’s not a lot of money in it, but it’s worth it if you work with the right landlord and you can find the right people,” said McGregor, who also has a breakfast and lunch kiosk at Poplar Avenue and Kirby Parkway in the Forum Building.
McGregor’s landlord for both properties is Orlando, Fla.-based Parkway Properties Inc., which is under contract to sell the Forum by March and is currently marketing Morgan Keegan Tower. While the local office sector is eagerly awaiting the transaction’s effect on the market, McGregor anticipates business as usual.
“I imagine it’s not going to affect me at all,” McGregor said. “We’re an amenity no matter how you cut it.”
But the restaurant/office building model doesn’t work for every user. One Commerce Square, for example, had a coffee and deli provider that was slated last summer to take over the 3,800-square-foot space formerly occupied by McAlister’s Deli, but the deal never materialized.
“Unfortunately, we weren’t able to come to terms on that specific user,” said Bentley Pembroke of Cushman & Wakefield/Commercial Advisors LLC. “We’re really looking for a seasoned, local restaurateur that can provide a breakfast option with a coffee kiosk, as well as a lunch and then maybe an early dinner or a happy hour service. Kind of a fresh, hip, casual dining experience. Finding all three of those aspects in a user for that restaurant space is pretty specific and we just haven’t found the right user that’s a good fit for us and also a good fit for the user.”
A few blocks northeast on Jefferson Avenue, One Memphis Place has a 1,000-square-foot retail space that’s also been challenging for CB Richard Ellis Memphis to fill after it was vacated last year.
“Up and down, you see a lot of these buildings do have success if they’ve got a good product and good service. It kind of just depends on the situation.”
Senior associate, CB Richard Ellis
“We have been trying to lease it for some time and we’ve had a couple of people interested in it, but so far, nobody has really been able to commit to it yet,” said CBRE senior associate Don Drinkard. “Some of it has to do with the conditions of the economic environment which we live in as well. More than likely, the user of that space is going to be a mom-and-pop type operation looking for start-up capital, and it’s a tough time to do that these days.”
That’s not to say that CBRE hasn’t been fortunate in leasing restaurant space its other Downtown office buildings, including Lenny’s, Majestic Grille, Blue Fin, Blind Bear and Silly Goose in Peabody Place, and Bogie’s Deli and Felicia Suzanne’s in Brinkley Plaza.
“Up and down, you see a lot of these buildings do have success if they’ve got a good product and good service,” Drinkard said. “It kind of just depends on the situation.”
Janice Allen, manager of Bogie’s at 80 Monroe Ave., attributes her store’s 12 years in business to convenience, service and food.
“We have people that eat lunch in here two or three times a week,” Allen said. “Your repeat customers are where it’s at. My best advertisement is the people that work for me and the food we have, which I have to say is above standard.”
It’s an important model to have in place, Allen said, given the stiff competition of other nearby eateries. Because Bogie’s address is on Monroe and is “sort of hidden” under awnings, the longtime Memphis sandwich shop has a sign displayed at the entrance to Brinkley Plaza on the Main Street Mall.
“We put it out front on Main Street to try to let people know we’re here,” Allen said. “We’re still a surprise to people; they go, ‘I didn’t know Bogie’s had a location down here.’ I’m glad we have a storefront, that’s a good thing. It keeps us on our toes. From my front door, you could probably walk within a five-mile radius and easily come across 30 or 40 different eating places, so that’s a challenge.”
Felicia Suzanne Willett, owner and executive chef of Felicia Suzanne’s, also has to occasionally direct people to her front door in Brinkley Plaza. But her upscale dining spot will celebrate its 10th anniversary on March 22, and a lot of that she attributes to her relationship with landlord Loeb Properties Inc. and leasing firm CBRE.
“There are amenities that come with the offices like window washing, floor cleaning, painting or HVAC repairs,” Willett said. “The building, because there are so many tenants, already gets a discount if you use their preferred vendors. Because the landlord wants to make everything look nice, I sort of fall under that umbrella with them. It’s better pricing than if I was in a location like a house or maybe even a smaller place down on South Main where they’re sort of like one- or two-floor buildings.”