The relationship between food and beverage (F&B) and real estate was the topic on 30 September, in a Digital Session dedicated to food and beverage market analysis and its role within real estate as part of the build-up to MAPIC 2021.
This online event also acted as prelude to The Happetite, which will play an important part at MAPIC 2021, which takes place in Cannes, France from 30 November to 2 December this year, after being held digitally alongside LeisurUp in 2020.
The speakers were Jonathan Doughty, project director, leasing services, ECE Marketplace, Mark Mushkin, VP international development, Carl’s Jr, and Monica Cannalire, founder & managing director, Younicorn. The session was moderated by Vincent Mourre, CEO & co-founder, Whitespace Partners.
In his food and beverage market analysis, Doughty set out the position for developers and landlords as they wrestle with the new food and beverage market and F&B sector growth opportunities.
“We are reinventing ourselves, because we have to start delivering new places for people that they want to come to,” he said of F&B real estate.
Once we are through the problems created by COVID and back rents, there is a very exciting runway ahead of us. The first thing is to tidy up all the loose ends, a lot of people have been battered and bruised and we have recognised that and tried to ensure that our investors and our operators don’t lose money.
F&B real estate growth opportunities
He also stressed that expertise in the F&B sector would become an increasingly valuable commodity: “It’s not an easy sector to understand. Those that do are becoming more and more valuable, because we understand the business model. We need to know absolutely everything about the foodservice industry if we’re going to capitalise,” he said.
Monica Cannalire, founder & managing director, Younicorn, was also optimistic and said that F&B and real estate industries were showing more “honesty and transparency” in finding new ways of working together.
Some property companies are resisting and trying to go back to the past,” she warned. “But some are trying to bring in new terms and conditions to make things work in the future. It’s a pretty exciting moment and more real than ever. And tastier than ever.
However, Mark Mushkin, VP international development, Carl’s Jr, also stressed that not everything that had changed during the pandemic would remain. US-based Carl’s Jr has around 80 restaurants in Europe, while globally it operates through around 100 franchisees and nearly 4,000 restaurants globally, having recently passed 1,000 outside the US.
Our needs are evolving but I think we need to be careful about our rush to say that everything is going to be different,” he said of the food and beverage market. “We are swimming in the new formats but I really bristle at notions of the ‘trillion-dollar’ delivery industry. Do people want lukewarm food on their laps? My experience is that people are hungry to get out. The difference is they don’t want the delivery driver clogging up the line. If we bolt this on to our formats, then everyone suffers. We have to find creative solutions.
Drive thru and new F&B formats
Carl’s Jr has been piloting new formats and Mushkin said: “It’ all about testing. We have an omni-channel model that we tested first in Dubai [where the restaurants are known as Hardees], which can have more seating bolted on if required. We are developing that same omni-channel model in Australia. It solves two problems, the delivery and cap ex. We are reining that in with the modular approach.”
Looking at how real estate and F&B can work together, ECE’s Doughty noted: “The whole point of restructuring is to take advantage of the opportunities we didn’t know we had. So when we redesign food spaces, designing them in a different way, so customers see the front-facing and the delivery comes in at the back of house.
There is a huge demand for drive-thru, which doesn’t suit a lot of our properties so we are looking at how we do that. We need to look at how we accommodate that and it is integrated and we get a benefit from it.
Mushkin took up the point and said that while the company is “eagerly seeking” partners for F&B development projects in the UK and Germany, finding the right formats was critical.
“Drive thru is the heart of our business and I don’t know if people understand how valuable that was to the business during the pandemic. We actually grew by 50 restaurants last year; this year we will hit 90-100,” he said. “We’re looking to landlords and developers to help us solve that problem, where drive thru is so important. We’re looking to add 50-100 new stores into Europe and if we can’t get drive thru then that will impact growth.
F&B and property: Are we back to normal? is available on-demand and is part of MAPIC’s overall theme for 2021, People and Places: A New Chapter, which will bring together MAPIC, LeisurUp and The Happetite. It is part of a series of digital events, which will provide valuable insight on a range of topics and trends.
MAPIC, LeisurUp and The Happetite will be held together at the Palais des Festivals, Cannes, France from 30 November to 2 December.
Read more about three steps to F&B recovery, restart opening up retail, leisure and F&B, developers empty premises as an opportunity and players the food property opportunity.