Franklin Street
$5 hot chocolates, gentrification and the future of food in NYC
About 6 months ago, I read a great Observer article entitled ‘Death of the Neighborhood Restaurant’, about how restaurants in Manhattan paying market rent now can’t make a profit unless they charge $25 or more for an entree. This morning, a cold brew coffee, hot chocolate and plate of pancakes ran me $39 including tip, at Bubby’s. Around Tribeca, low and high end staple restaurants are closing at a steady clip from rent hikes as their leases come up - next on the close list is The Harrison after a 14 year run. The ‘chain-ification’ of Manhattan seems like an inexorable trend.
I’m neither anti- nor pro- gentrification. On one hand, I wish downtown NYC was still affordable enough for independent shops and restaurants, with lofts filled by artists rather than bankers. On the other hand, I’m not complaining about the safe streets, pier parks, & great public schools that the last 15 years has delivered. I am also happy to pay $5 for a hot chocolate if it means that Bubby’s can stay in business. I think that the faster we get used to not paying false-economy restaurant prices, artificially deflated by sub-market rent on old leases, the better - we need a sustainable restaurant scene. The ‘new’ New York can afford it, even if it means paying $20 for pancakes to enjoy the true cost of a going-out-to-eat experience.
At the same time, the opportunity to build an online/offline brand without an expensive storefront has never been better - having started in more traditional e-tail categories (Bonobos, Warby, etc.), there’s now a lot of NYC innovation in food distribution models. Kitchensurfing is a great example of bringing the talent of the chef to the home, disintermediating the restaurant saddled with high operating costs. Food trucks (who also have idiosyncratic economics of their own) tweet their locations same-day so fans can queue up at lunchtime. Last week Maple was announced, combing a startup team with Momofuku master David Chang to launch a delivery-only restaurant in NYC. Savory, with only a catering kitchen, is creating several delivery-only restaurants for the B2B market, and ZeroCater is activating under-utilized restaurant kitchens during the day to deliver an end-to-end catering service to startups and other companies who provide food to their staff. And upstart ‘online only’ bakeries are cropping up too, such as Mini Melanie, launched by the former pastry chef at Blue Hill (full disclosure - she’s my sis-in-law).
I’m excited to see how the ‘restaurant without the restaurant’ trend develops over the next few years in the city. I’m also happy to enjoy very expensive plated food at a restaurant from time to time, if it means keeping our local restaurants open for the next 20 years.
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