< PreviousThe Rent Crisis caterermiddleeast.com September 2020 30 In the Caterer Middle East survey of 100 restaurateurs back in May, the overwhelming consensus was that the biggest issue faced by operators was that of rent. Months later and the problems persist, with many saying the industry is facing a rent crisis as some landlords refuse to back down and offer any relief to struggling restaurants. And so with this in mind, we decided to host the most engaging Caterer Middle East Conference Bitesize webinar yet. Joining editor Simon Ritchie were three experienced F&B operators, plus a Dubai-based real estate lawyer to discuss the intricacies and dif culties of dealing with landlords in the time of Covid-19. One of the rst to speak out at the onset of the pandemic and ask for help from landlords and the government was Gates Hospitality founder and chief executive Naim Maadad. Describing the “challenge” of the past ve months, Maadad said the industry is undergoing a “maturity cycle” but on a shortened timeline due to the coronavirus. “In the last ve years there’s been a huge shortage of venues, then since 2017 onwards there’s been supply coming through, then after that there’s been an oversupply. Covid-19 is putting on fast forward what I’ve been suggesting over the past few years. I’ve been very vocal about the oversupply, I’ve even suggested we put a limitation on trade licences and I was heavily criticised for that, but what I’m looking at is sustainability.” On a previous Caterer Middle East webinar, Tashas founder Natasha Sideris had shared her tips for communicating with landlords, and Nando’s UAE managing director George Kunnappally con rmed that the open approach suggested by Sideris is indeed the right way to go about it. He said: “We’ve had interesting conversations with landlords where we have opened up our books and shared our numbers and we have tried to talk it out with them and say this is how our business model works, even if we do the same revenue in two different malls with similar rents, our dine-in and delivery percentages are different so it doesn’t necessarily translate to the same Caption here please George KunnappallyThe Rent Crisis 31 September 2020 caterermiddleeast.com margins. Much of the time they don’t realise that so we’ve had some success by sharing our knowledge and getting a positive response when it comes to rent relief in this period.” However, Kunnappally did concede that it wasn’t always effective, saying talking to some stubborn landlords was like “barking at the moon” as they would refuse to understand the operator’s predicament. In those cases, said Kunnappally, the best case was to relocate as it is not a relationship worth trying to salvage. One of the issues with trying to discuss rent relief for the events of the past half year is the different stages of lockdown, said La Cantine Du Faubourg owner Rizwan Kassim. “We have two different stages of this crisis,” he said. “We had the months between March and June/July where we have had to just try and survive, and now we’re back to the normal trend of the past ve years so it’s complicated to go back to Jumeirah and DIFC and say we still want a rent reduction when we are making the same numbers as last year.” Legal expert Jonathon Davidson, founder of Davidson & Co lawyers in Dubai, compared the current situation with the heady pre-2008 days when landlords had an abundance of restaurant operators wanting to open up. He said: “Back then I was inundated with landlords asking if we could “Proud to say I put my foot down and kept places closed” look into the lease agreements and renegotiate as the market was growing exponentially upwards, so landlords were fairly robust and aggressive in trying to approach retailers for an uptick in rent. “If you look at where we sit today, it’s the opposite side of the spectrum. Today we have landlords asking us how we can stick by the rent review clause to be able to sustain their rent, and obviously you’ve got the restaurateurs asking us what kind of legal leverage can we bring into play to discuss with the landlords.” Davidson said that so far he has seen a general willingness to negotiate on both sides, with landlords wary of losing a client in the current climate. “From the restaurant operator’s perspective there’s a huge capital expenditure in moving to a new venue, but from the landlord’s perspective there’s a huge risk with new restaurateurs coming and renegotiating the entire gambit, so the rent could be 20, 30, 40% percent lower and there could be six, eight, 12 months lag time in getting the new infrastructure in place.” Faced with the tough decision of whether to reopen his venues into a post-Covid world and with all the restrictions and new regulations that would bring, Maadad said he was “proud to say I put my foot down and kept places closed until I got my wish list, not fully ful lled, but suf cient for me to minimise my losses.” Underlining that it was just about minimising his losses, Maadad said it was important that landlords also shoulder some of the responsibility for nancial losses during this period, rather than operators forced to suffer alone. Rent deferments have been one of the main offers made by landlords, but Davidson said that these are “simply Folly stayed shut until August Naim MaadadJonathon DavidsonThe Rent Crisis caterermiddleeast.com September 2020 32 kicking the can down the road”, with operators forced to pay the money back in six months anyway and no pressure actually lifted from their shoulders in the long term. “I don’t entertain deferrals,” agreed Maadad. “If I’m not generating any revenue then I can’t do the repayments. If I’m not making money, I’m not paying you. Simple.” Kassim had managed to negotiate a turnover rent model for his concept Ninive which has been closed since March and only doing home deliveries, keeping the impact to that business low, but for La Cantine it has been a tougher struggle with a different landlord to agree on a rent relief package that would be fair to both parties. Building off of Kassim’s points, Kunnappally said for Nando’s it was simply not negotiable that they should pay rent, marketing fees, chilled water bills, or anything else for the duration of the spell when stores were on complete lockdown. With most landlords understanding of the situation, only in a couple of instances has Kunnappally either went to the rental dispute centre to request an early termination of contract or chosen to just let an expiring lease run out rather than renegotiate terms because the relationship with the landlord was untenable. An issue almost unique to the UAE which can play a big part in rental disputes is the criminality of cheques, with the person issuing the cheque liable for the full amount, as opposed to most other countries where it will be linked to the business. While Davidson said the current system is being slowly ltered out, it can still cause problems if cheques are cashed when no money is in the account — as has been the case for several operators left without income during the current crisis. “I’ve had a whole gambit of scenarios where landlords have been very reasonable with longstanding tenant/ landlord relationships and there’s been a great resolution,” said Davidson. “I’ve also had the other side where very large, supposedly sophisticated landlords have, accidentally or due to an anomaly in the process, have cashed cheques and somehow those cheques have walked to the police station and criminal charges have been brought on those cheques. In some circumstances, landlords are being very draconian.” Davidson’s advice when dealing with cheques is to write as many and as low as value as you possibly can, with lower amounts under AED200,000 generally not being charged criminally. Planning for the new normal is also necessary, said Davidson, who advises that operators put in clauses that insure in case of further pandemics or lockdowns in the future, with landlords only counting force majeure in cases of insurrection, terrorism, earthquakes, oods, and other natural disasters, but not the likes of coronavirus. With no end in sight to the pandemic, and restaurants still operating under severe restrictions, Kunnappally called on landlords to do more to help operators. Calling them “our most critical partner in the long run”, he voiced his belief that both landlords and operators are in this together and asked: “Do you want to help us survive or do you want to build your next mall or declare earnings for your shareholders? What’s your priority here?” You can watch the full webinar on the Caterer Middle East YouTube channel, with even more nuanced insight and helpful tips on how to approach your landlord for rent relief. Nando’s in Deira Rizwan Kassim of La Cantine Du Faubourg took part in the panelPartner content 33 September 2020 caterermiddleeast.com Why do you think La Tablita resonates with its customers? Dubai’s F&B s cene is quite diverse, it is shaped by countless trends, exotic concepts and out-of-the-box ideas. La Tablita is an authentic Mexican restaurant that offers an extensive F&B offering, together with a Taco Shop experience, specialty nights, vegan menu, and fabulous estas. Personally, I feel what works best for La Tablita is that we pioneer in distinguishing the avours of food and drinks served at the venue. The second pillar that helps maintain our standing is the exceptional hospitality offered by our passionate culinary and service team! Where do you get the inspiration for your dishes? Growing up in a traditional Latin family, food was always a big part of life. I remember, back in the days, my grandfather would take all the grandchildren to a different restaurant. I also vividly remember my dad’s love for Pride of Mexico Chef de cuisine Ivan Vidal tells us how award-winning La Tablita is pioneering authentic Mexican cuisine at Hyatt Regency Dubai Creek Heights cooking — always trying different things, always excited about new dishes; until he opened his own restaurant back in Mexico when I was 14. That’s where I got my inspiration from in the initial stages of my career. Now, travelling drives my motivation. Discovering avours in new cities inspires me to learn about various cultures and food preferences. La Tablita’s offering is extremely authentic, so much so that our avours can transport you straight to the streets of Mexico. Some key ingredients used in our menu are actually imported from Mexico like avocados, the chillis (habanero, serrano) dried chillies (guajillo, pasilla) and nopales (Mexican cactus). So to me, maintaining the authenticity of the food, drinks and entertainment is quite imperative. How important is it for you to share your Mexican heritage with your customers through events? Well the Mexican Independence Day celebration at La Tablita has always been a great success and is one of the most loved events by our loyal customers residing in and around Dubai. This year, we are taking the celebration to an even bigger scale by hosting a fabulous four-day Mexican esta from 15th to 18th September! This extended party with live entertainment is set to begin on the 15th, with our famous Taco Tuesdays night, followed by the next two evenings where we of cially celebrate Independence with a traditional spread and special taqueria. Finally, the festivities end on a fun note with our Friday drunch, an exciting lazy brunch concept with unlimited margaritas and chef’s choice of tacos, ceviches, and more. In Dubai, we are famously known to offer authentic Mexican cuisine at our restaurant, so representing the true heritage consistently is something that holds immense value. How do you plan to keep La Tablita’s offering fresh in the future? Although La Tablita is already a known and loved restaurant, my aim is to make sure that the food, atmosphere, entertainment, drinks, and overall experience is so good, that we become an F&B destination par excellence. We are a fun and contemporary Mexican restaurant showcasing street favourites with a live taco shop and cevicheria. By offering an authentic Mexican vegan menu and two fantastic concepts — Taco Tuesdays and Friday Drunch, we at La Tablita promise to offer an exclusive dining experience for those who wish to fall in love with Mexican food and culture. La Tablita is located at lobby level, Hyatt Regency Dubai Creek Heights. The La Tablita drunchcaterermiddleeast.com September 2020 34 THE ARTISAN, WALD Reopened and refocused, this Italian eatery is striving for the top 35 September 2020 caterermiddleeast.com DORF ASTORIA DIFCSpotlight: The Artisan caterermiddleeast.com September 2020 36 When at the end of 2019, The World’s 50 Best revealed its inaugural ‘Discovery’ directory of top restaurants around the world that didn’t quite make it into the famous list, Dubai had 10 entries. That’s 10 restaurants that represent the crème de la crème of the city’s sizeable dining experience. The only problem with the list was that one of the venues was shut. The Artisan by Enoteca Pinchiorri closed its doors at the end of 2018, but has now reopened, dropping the name of the three Michelin-starred restaurant it was previously associated with and going out on its own. But as much as things have changed, they’ve also stayed the same. While The Artisan has moved, it’s still in the same Burj Daman building, only now it can be found on the ground oor of the Waldorf Astoria DIFC. And while the Enoteca Pinchiorri association is gone, you probably won’t notice it in the food, as executive chef Luca Tresoldi reveals to Caterer that The Artisan team always had creative control. He says: “Our collaboration with Enoteca Pinchiorri de nitely helped The Artisan position itself high up in the market as a casual-chic Italian restaurant in the region and with that status came a number of awards to prove it. We were always able to meet our diners’ expectations. What people don’t know though is that we were always in charge of the menu engineering. I have worked with the Enoteca team for years and they trusted me with the creation of the menu for their outpost in Dubai.” Although it might be a second run out for the Italian eatery, managing partner Firas Fawaz tells us that this is The Artisan becoming what it was always meant to be. He explains: “Originally, The Artisan “What consumers don’t know is we were always in charge of the menu” The Artisan’s compact dining roomSpotlight: The Artisan 37 September 2020 caterermiddleeast.com was supposed to open at the same time as the hotel, with a proper outdoor space. However, the hotel opening got delayed and we were given the opportunity to open it in Burj Daman; that helped the brand establish its positioning in the market and grow its following. Once the Waldorf Astoria opened, we naturally relocated giving our guests easier access and the association to the hotel evidently gives the restaurant great exposure.” Fawaz is under no illusion about the size of task facing The Artisan. Not only did it open in the midst of a global pandemic — operating at rst as a delivery-only pizza joint — but it’s located in one of the world’s most competitive F&B cities. With this in mind, Fawaz is relying on the concept to speak for itself. “Today’s consumer is smarter with their restaurant choices and it is now harder for restaurants to retain them due to the saturated market. However, we let our authentic food, the friendly service and our ambiance speak for the brand. I believe the new concept is one of the Tortelli cacio e pepe ai carcio Spotlight: The Artisan caterermiddleeast.com September 2020 38 Polpo croccate, patate e fagiolini verdeSpotlight: The Artisan 39 September 2020 caterermiddleeast.com smallest restaurants in Dubai and the idea was to create a homey venue with a personalised experience, where guests would feel at home as if they were in their own dining room.” The 70-seat restaurant has a cosy feel, with Fawaz saying “the idea was to have a warm and familiar interior, yet elegant with nice bold textures and colours.” He adds: “We’ve learned this the hard way but today’s consumer is no longer interested in pretentious interiors. They seek comfort and a space they can relate to that can enhance their experience and creates some sort of positive feel.” Word of mouth has been a main driving force for customers both returning to The Artisan they once knew, or trying it out for the rst time, says Fawaz. “People are talking about The Artisan passionately. I think this is the best marketing support someone can ask Artisan offers bespoke cocktails Artwork adorns the wallsNext >