Brandon Donnelly
Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.
Brandon Donnelly
Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.
This past spring a new restaurant called Ooki Pavillon opened in the Sihlfeld neighborhood of Zurich. It's an izakaya-style Japanese restaurant that is housed in a seven-sided pavilion that was initially constructed in the 1950s. The place looks great (see above), but what you may also find interesting is that the pavilion was initially built as an amenity space (leisure room) for one of Zurich's first high-rise apartment blocks. Check it on street view, here. Supposedly there are only a handful of these sorts of pavilions remaining in the city. And so it is nice to see this one get repurposed (I don't know what it was prior to Ooki). It is also a good reminder that, while many of our post-war apartment blocks aren't the most urban in their approach, rethinking the ground plane can go a long way.
Images: Ooki Pavillon
This is an interesting study by Clio Andries (assistant professor at the Georgia Institute of Technology) and Xiaofan Laing (city planning graduate student). It looks at restaurant “chaininess” across the United States.
To do this, they mapped over 800,000 restaurants and looked for, among other things, restaurants with the same name. If the same restaurant name shows up in multiple locations, it is considered to be a chain.
Looking at the above snapshot of San Francisco, a yellow dot represents what is thought to be an independent restaurant and a dark purple/maroon dot represents a chain.
Blair Welch, co-founding partner of Slate Asset Management, was recently interviewed by Don Wilcox of RENX about the company's recent acquisition of the Commercial Real Estate Business of New York-based Annaly Capital Management. As part of the deal, we also acquired $0.4 billion of grocery-anchored real estate assets across the US. These were purchased by Slate Grocery REIT (TSX: SGR.UN). What some of you maybe don't know, though, is how we as a company view these kinds of assets as being essential food infrastructure, more so than as being retail assets. So here are a few excerpts from the article and quotes from Blair that explain why, in our view, this distinction matters.
“We started buying grocery-anchored real estate in a big way in the financial crisis and I think we always looked at grocery-anchored real estate as food logistics, rather than a retail play,” Welch explained. “In the pandemic it’s really proven the local food store, or the spoke in the hub, is just as valuable as the hub itself.”
Despite an increase in online grocery shopping (to about 10 per cent in the U.S.), people are still going to the stores. Or, at least, (are) getting their products from the local stores. Again, think “food logistics.”
“That (10 per cent bought online) means 90 per cent is done in store,” Welch observed. “Now, here’s the interesting thing. Over 90 per cent – probably closer to 95 per cent – of the online sales are done at the local store.
“So what we are saying is over 99 per cent of all the sales are done at the local stores, whether it is click and collect, or someone delivers. You are not changing the distribution pattern.”
Here are a few more words and a comparison to what Amazon is and has been doing when it comes to food logistics:
“If I’m Kroger or Walmart if I have to pay $10 (per square foot) for my warehouse what’s the difference if I’m paying $10 for my store? It’s the same cost, they just look at it as a distribution cost,” he said.
However, those stores are in the middle of most neighbourhoods. Exactly where Amazon wants to be.
“I think Amazon is an amazing company. I think their acquisition of Whole Foods and others is actually to get closer to the consumer. And the Whole Foods (acquisition) was just under 400 grocery stores in a market of 35,000 stores.
“If I am Walmart with 5,000 stores or Kroger with about the same under different banners, that infrastructure is extremely valuable.”
Slate will soon own more of it.
For the full article, click here.
This past spring a new restaurant called Ooki Pavillon opened in the Sihlfeld neighborhood of Zurich. It's an izakaya-style Japanese restaurant that is housed in a seven-sided pavilion that was initially constructed in the 1950s. The place looks great (see above), but what you may also find interesting is that the pavilion was initially built as an amenity space (leisure room) for one of Zurich's first high-rise apartment blocks. Check it on street view, here. Supposedly there are only a handful of these sorts of pavilions remaining in the city. And so it is nice to see this one get repurposed (I don't know what it was prior to Ooki). It is also a good reminder that, while many of our post-war apartment blocks aren't the most urban in their approach, rethinking the ground plane can go a long way.
Images: Ooki Pavillon
This is an interesting study by Clio Andries (assistant professor at the Georgia Institute of Technology) and Xiaofan Laing (city planning graduate student). It looks at restaurant “chaininess” across the United States.
To do this, they mapped over 800,000 restaurants and looked for, among other things, restaurants with the same name. If the same restaurant name shows up in multiple locations, it is considered to be a chain.
Looking at the above snapshot of San Francisco, a yellow dot represents what is thought to be an independent restaurant and a dark purple/maroon dot represents a chain.
Blair Welch, co-founding partner of Slate Asset Management, was recently interviewed by Don Wilcox of RENX about the company's recent acquisition of the Commercial Real Estate Business of New York-based Annaly Capital Management. As part of the deal, we also acquired $0.4 billion of grocery-anchored real estate assets across the US. These were purchased by Slate Grocery REIT (TSX: SGR.UN). What some of you maybe don't know, though, is how we as a company view these kinds of assets as being essential food infrastructure, more so than as being retail assets. So here are a few excerpts from the article and quotes from Blair that explain why, in our view, this distinction matters.
“We started buying grocery-anchored real estate in a big way in the financial crisis and I think we always looked at grocery-anchored real estate as food logistics, rather than a retail play,” Welch explained. “In the pandemic it’s really proven the local food store, or the spoke in the hub, is just as valuable as the hub itself.”
Despite an increase in online grocery shopping (to about 10 per cent in the U.S.), people are still going to the stores. Or, at least, (are) getting their products from the local stores. Again, think “food logistics.”
“That (10 per cent bought online) means 90 per cent is done in store,” Welch observed. “Now, here’s the interesting thing. Over 90 per cent – probably closer to 95 per cent – of the online sales are done at the local store.
“So what we are saying is over 99 per cent of all the sales are done at the local stores, whether it is click and collect, or someone delivers. You are not changing the distribution pattern.”
Here are a few more words and a comparison to what Amazon is and has been doing when it comes to food logistics:
“If I’m Kroger or Walmart if I have to pay $10 (per square foot) for my warehouse what’s the difference if I’m paying $10 for my store? It’s the same cost, they just look at it as a distribution cost,” he said.
However, those stores are in the middle of most neighbourhoods. Exactly where Amazon wants to be.
“I think Amazon is an amazing company. I think their acquisition of Whole Foods and others is actually to get closer to the consumer. And the Whole Foods (acquisition) was just under 400 grocery stores in a market of 35,000 stores.
“If I am Walmart with 5,000 stores or Kroger with about the same under different banners, that infrastructure is extremely valuable.”
Slate will soon own more of it.
For the full article, click here.
San Francisco has a very high percentage of independent restaurants. In their study, the city receives a chainess score of 28, compared to the national average of 1,247. (Some cities in the southeastern US are in the 1,900s).
One of the interesting takeaways from this study is that there appears to be a correlation between chaininess and built form. Generally speaking, the study revealed that auto-centric communities tend to have more chain restaurants, versus more independent restaurants in pedestrian-centric communities.
This is perhaps intuitive if you’ve ever driven and traveled across the US, but it is interesting to consider what is actually leading to this food and beverage outcome. Density certainly plays a role.
San Francisco has a very high percentage of independent restaurants. In their study, the city receives a chainess score of 28, compared to the national average of 1,247. (Some cities in the southeastern US are in the 1,900s).
One of the interesting takeaways from this study is that there appears to be a correlation between chaininess and built form. Generally speaking, the study revealed that auto-centric communities tend to have more chain restaurants, versus more independent restaurants in pedestrian-centric communities.
This is perhaps intuitive if you’ve ever driven and traveled across the US, but it is interesting to consider what is actually leading to this food and beverage outcome. Density certainly plays a role.
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