09.21.2013 LIBN | Chains eye LI downtowns
By David Winzelberg
When New York-based restaurant chain Bareburger wanted to expand to Long Island, the company looked past the strip mall and zeroed in on some prime downtown spaces.
“Nothing against malls and shopping centers,” said Bareburger founder and CEO Euripides Pelekanos, “but we feel more comfortable where you can immerse yourself in the community.”
Bareburger isn’t alone. It’s one of several national and regional retailers that feel, contrary to long-held belief, that shopping centers aren’t always the most desired suburban locations.
The Tampa, Fla.-based Bonefish Grill chain is building a restaurant on the site of a former movie theater in the middle of Rockville Centre Village. The Scottsdale, Ariz.-based Massage Envy chain opened a studio on Port Washington’s Main Street, and Panera Bread recently opened a location in the heart of downtown Huntington.
“A lot more of our clients have expressed interest in these downtown locations,” said retail broker Jayson Siano, a principal of Sabre Real Estate Group in Garden City, Bareburger’s exclusive national site-finder.
While retail rents are comparable between busy shopping centers and bustling downtowns – $25 to $50 a square foot – center owners sometimes protect tenants by not leasing to competitors so those spaces aren’t always available.
The concern with downtown locations is usually more about a lack of parking than competition.
Most of the chains leaning toward downtowns are restaurants and other food concepts counting on daytime foot traffic from nearby businesses, area residents and shoppers.
For its Great Neck location, run by franchisee Dennis Manolatos, Bareburger relies on a nearby municipal parking lot to accommodate some customers, though foot traffic generated by other stores, offices and the nearby Long Island Rail Road station is its mainstay. Because of its urban roots, Bareburger is comfortable where cars aren’t.
“The downtown vibe and the feel with eclectic shops and restaurants really fit our brand,” Manolatos said.
Since its first burger-and-craft-beer joints opened in Astoria in 2009, Bareburger has since opened 13 more around the city. There will soon be eight additional locations in New York, New Jersey and Connecticut, with new franchises planned for Boston, Chicago, Washington, Philadelphia, Florida and Ohio. Most will be in downtown locations.
On Long Island, the company is negotiating on future sites in the heart of Huntington and Rockville Centre.
Others will follow, according to Siano, who said ongoing efforts to revive the Island’s downtowns with more in-town housing and pedestrian-friendly streets will encourage retail chains to seek out stores in Main Street settings.
Another in the better burger category, Denver-based Smashburger, is planning to build a franchise store in Farmingdale Village. And while he wouldn’t name the company, Siano said he’s working with a sandwich/salad concept with more than 25 Manhattan stores that’s looking for spots in Great Neck and Port Washington.
“There are a lot of urban concepts that only exist in major cities,” Siano said. “They’re looking for downtown locations because it’s more of what they’re used to.”
The retail-chain interest in the Island’s downtowns is also a boost for smart-growth planning advocates, who’ve campaigned to make regional downtowns more viable.
“This is an encouraging trend that is mirrored nationally as customers seek downtown areas for varied experiences including events, music, arts, culture, parks and a sense of place,” said Eric Alexander, executive director of Vision Long Island. “The positive outlook for downtown housing and office space will further strengthen these new investments.”