After a three-year slowdown, Tampa Bay area restaurants are on the rebound. And that's giving restaurateurs the courage and financial wherewithal to open new locations.
By SCOTT BARANCIK
Published April 25, 2004
Crabby Bill's is downright chipper these days.
Through March, sales at the Indian Rocks Beach seafood chain were up 40 percent over last year. A 10th location, its first franchise, will open Saturday at George Steinbrenner's Radisson Bay Harbor Hotel in Tampa after a $1-million renovation. Four more openings are expected by year-end.
"We budget for 5 percent growth, so to see these increases is incredible," said operations chief Matt Loder, son of founder Bill Loder.
After a three-year slowdown marked by terrorism, war and a languid economy, Tampa Bay area restaurants are on the rebound. Revived tourism is bringing in more customers. Financially confident diners are splurging on pricier entrees, like Crabby Bill's $27.95 lobster tail. The National Restaurant Association projects restaurant sales in Florida will grow 5.1 percent this year, to $18.1-billion.
That's giving local restaurateurs the courage and financial wherewithal to open new locations. On May 2, the owners of Tampa's Mise en Place restaurant and Melting Pot chain will tempt Clearwater diners with GrillSmith, featuring items such as grilled wild mushroom meatloaf and grilled tortilla pizza. Columbia Restaurant Groups president Richard Gonzmart is part of a group opening franchises of Moe's Southwestern Grill and Mama Fu's Noodle House in the bay area. Outback Steakhouse of Tampa said it will open its first Paul Lee's Chinese Kitchen restaurants this year, including one in Tampa's Citrus Park neighborhood.
At Tampa's Channelside alone, recent openings include Grille 29, Signature Room Grille, Hooters, Splitsville and, next month, Tinatapas.
"We probably have all the business we can handle now," Grille 29 general manager Rick Keefer said.
"I think it's a great time to open a restaurant," said Frank Chivas, who owns the popular Salt Rock Grill and Island Way Grill restaurants. Late last year, he opened his first new restaurant since the 9/11 terrorist attacks: Hogfish Grill, a seafood and barbecue joint in Clearwater.
It's not just a local trend. National Restaurant Association chief economist Hudson Riehle said he expects U.S. restaurant sales to climb 4.4 percent this year to $440-billion, the biggest gain since 2000. The figure reflects both table-service dining (4.6 percent) and fast food (3.9 percent).
That's good news for restaurant workers, who number about 500,000 in Florida. It's also good news for bay area residents, who now have more than 4,600 sit-down restaurants to choose from in Pinellas, Hillsborough and Pasco counties alone.
"It's wonderful to see restaurants with lines out in front of them, people waiting to enjoy a good meal," said Lewis Kroll of St. Petersburg's Cleaners Closet, where sales of cleaning supplies to local restaurants are up 10 percent this year. "I've definitely seen a return to the normalcy of pre-9/11 time."
Surviving the downturn hasn't been easy. Not everyone has prospered.
Since June 30, the number of sit-down restaurants in Pinellas and Citrus counties has shrunk slightly, while Hillsborough, Pasco and Hernando have seen modest increases, according to licensing data from the Florida Department of Business and Professional Regulation. By and large, every new restaurant is replacing one that failed before it.
Rio Bravo Fresh Mex's exodus from the bay area opened the way for a Johnny Carino's Country Italian restaurant on N Dale Mabry Highway. Shells Seafood Restaurants, a Tampa chain, is in serious financial trouble and closed its restaurant on Fourth Street N in St. Petersburg in January. The Loder family converted its upscale New Tampa Oyster Bar last year into the more honky tonk Crabby Bill's mold, due to poor sales under the initial concept.
The Radisson Bay Harbor Hotel's space opened up only after management decided Damon's wasn't cutting it anymore.
"Twenty-two new restaurants have come within a 3-mile radius of us in the last six years," said Rick Norberg, the Radisson's assistant general manager. "It's created a very competitive market in this corner of the world, and we felt we needed a fresh change to compete."
Competition for real estate has intensified, too. Red Lobster and TGI Friday's both fought for the Radisson space, Norberg said. Chivas said real estate agents regularly call him and others to see if they are planning to move or close.
Rising food and transportation costs are also a challenge, driving some bay area restaurateurs to raise their menu prices. Outback's flagship steakhouse chain will boost prices by 4 percent in 2004, its largest increase in several years. Analysts say restaurateurs nationwide are likely to raise the average check by 2.7 percent this year, the Wall Street Journal reported this month.
It's a sign of confidence that consumers will willingly absorb the higher prices. It's also a reflection of the rising wholesale prices for key items such as chicken and beef.
Still, many restaurants are enjoying larger sales gains than in some time. Outback Steakhouse said March sales at its Carrabba's Italian Grill and domestic steakhouse restaurants rose 3.1 percent and 5.3 percent, respectively. Melting Pot of Tampa reported that sales at its three bay area locations were up 12.9 percent in the first quarter of 2004 compared with a year earlier. At Orlando's Darden Restaurants Inc., same-store sales were up 7 to 8 percent at Olive Garden in March, though troubled Red Lobster saw its revenues fall 6 percent.
Several fast-food chains saw gains, too. Caspers Co., a McDonald's franchisee with 51 restaurants in the bay area and 22 around Tallahassee, reported double-digit sales gains through March.
Those who are thriving cite several keys to their success.
One is keeping up with the evolving American diet, which lately has focused on a high-protein, low-carbohydrate diet. Chivas said his restaurants are toying with healthier desserts, such as a ricotta cheesecake. Caspers Co. spokesman Bob Conigliaro said McDonald's new white-meat Chicken McNuggets and premium salads are attracting the health-conscious. Soon, parents will be able to substitute apple slices and caramel dip for french fries in their child's Happy Meal. An adult Happy Meal featuring a salad, bottled water, pedometer and fitness guide will be rolled-out nationwide.
For some, special discounts have worked well. During less flush times, Crabby Bill's introduced a $1.99 plate featuring a dozen clams, though it recently raised the price to $3.99 at all but one location. It still uses coupons as an enticement. "That's what the market is calling for now, a loss leader," said Ellie Jenkins, manager of the Indian Rocks Beach location and Bill Loder's daughter.
Outback wisely seized on the growing demand for takeout, delivery and drive-through meals, making changes to enhance both speed and quality. Two-income families have helped make off-premises dining one of the industry's key growth drivers.
To sustain their recent growth spurt, local restaurant owners will have to address a number of challenges.
One is increased competition. Since June 2000, the number of sit-down restaurants in Pinellas, Hillsborough and Pasco counties has risen a combined 16.1 percent.
Larger chains will need to balance growth and self-cannibalization. Sharen Weber, area director for Bob Evans Farm Restaurants and president of the Florida Restaurant Association's Pinellas chapter, said sales at her Brandon store are down this year because of competition from newer locations in Seffner and Temple Terrace. Another store is scheduled to open next month in nearby Sun City.
Rising gas prices don't appear to be stifling bay area tourism yet, but further spikes could cut slow traffic at local restaurants.
Restaurant owners must continue to keep up with the increasingly sophisticated American palate, as well as respond to our national obesity crisis. "We're just at the beginning," Hogfish's Chivas said.
But other trends favor growth.
In the short term, continued weakness in the U.S. dollar could draw more European tourists to the bay area. Longer-term trends that should boost domestic demand include the aging American population and shrinking leisure time.
There's plenty of room to grow. Though Americans eat an average of five commercially prepared meals a week, up from three in the early 1980s, they make 14 meals at home and skip two others, National Restaurant Association economist Riehle said.
"People have to eat," Crabby Bill's Jenkins said. "It's like a protected industry."
- Times staff writer Chris Sherman contributed to this report. Scott Barancik can be reached at barancik@sptimes.com or 727 893-8751.
Restaurants aplenty
The Tampa Bay area has no shortage of sit-down restaurants. Though the number hasn't grown much in the past nine months, it has leapt between 10.9 percent and 19.2 percent since mid 2000, depending on the county.
County/Mid 2000/Mid 2003/Current/Change since mid 2000/Change since mid 2003
- Source: Florida Department of Business and Professional Regulation, Division of Hotels and Restaurants.
Rising revenues
A number of national restaurant chains saw improved same-store sales in early 2004. Examples below show the change in U.S. revenues from March 2003 to March 2004, unless otherwise noted:
Chain/Sales change
Bonefish Grill/12.9 percent
Carl's Jr./9.6 percent
Carrabba's Italian Grill/3.1 percent
Chili's Grill & Bar/4.2 percent (Feb.-Feb.)
Fleming's Prime Steakhouse and Wine Bar/20.2 percent
