The rise of the residency restaurant

By Sophie Witts contact

- Last updated on GMT

Why London landlords are turning to short-term restaurant residencies

Related tags: Casual dining, Generation Next, Restaurant

London landlords are becoming increasingly nervous about signing restaurants up for long leases following several high-profile closures, according to a leading property expert.

Camilla Topham, director at property consultancy firm Distrkt, says site owners are looking at short-term lets as a means to avoid the negative PR of a restaurant failing.

Speaking at Restaurant​ magazine and MCA’s​ Generation Next conference, she said: “Landlords have seen a lot of failures in their estates, so there’s a nervousness around new concepts.

“The negative PR of letting a site as a permanent restaurant and having it fail has a big impact. They’d almost rather not re-let that property and leave the site vacant.”

This mentality has led to the launch of short-term incubator project 10 Heddon Street in Mayfair.​ The site was home to permanent restaurant Magpie until March, when it closed after less than two years of trading.

It has since relaunched as rotating pop-up, housing David Carter and Chris Leach’s pasta concept for three months until last week. Eater London​ reports​ that it will be replaced by a Japanese offer from Australian chef Shaun Presland in November.

BigHospitality​ understands that the former Stem site​ on nearby Princes Street, Mayfair is also likely to come up on a short-term lease.

Topham said this model has benefits for both landlords and operators. “Retail is also suffering so this is a way for landlords to offer a different USP and introduce more people to their estate.

“A lot of restaurant operators are keen to trial stuff without committing. It’s a great way to attract investors, who are a lot more nervous about funding projects that aren’t tried and tested.

“We’ve found there are more people than ever looking to run pop-ups at the moment.”

Residencies as test beds

Carter said the short-term residency has been key to refining his pasta concept and is now looking at longer-term sites. “It’s given us confidence, which you need when you are going to pour the better part of a half a million to a million pounds in to a restaurant,” he said. “Before you do that it’s important to know that you as a partnership and as a concept are ready for it.”

Ferdinand ‘Budgie’ Montoya, who ran his Filipino barbecue pop-up Sarap at the Sun and 13 Cantons pub in Soho for three months this year, said the residency similarly helped fine-tune his concept.

“I’m doing Filipino food which isn’t exactly mainstream,” he said. “It’s not something that I have experience of professionally as I’ve always worked in European kitchens, so it’s great to get customer feedback.

“If we look at Sarap’s first pop-up a year ago in Highgate, at The Sun and 13 Cantons it was almost a different product in terms of the service and way it was plated.

“[The residency] has opened up a lot of doors and really put us on the map. We had a great review from the Evening Standard​. It allows you to get potential investors to come in and talk to you.”

Sarap will launch its first standalone six-month site in Brixton Village later this year after winning the ‘experienced’ category in the market’s Brixton Kitchen competition.

Montoya adds that despite the benefits of short-term sites, operators need to be cautious about jumping on every opportunity. “Really look at the site to and see what value you have for the cost,” he said.

“On the flip side, landlords now see an opportunity to make a little bit more money through these pop-ups and will charge something that’s maybe not worth you paying for it.”

Ongoing trend

More London sites are likely to be made available on short term leases in the future, according to Topham. “Landlords are nervous and when they get a site back are probably more open to keeping it as a permanent pop-up site with a roster of chefs,” she said.

“The street food explosion has meant there are a lot of creative operators on the street that might be looking to move to bricks and mortar.

“The climate is good if you’re a start-up. We will see more restaurants opening and landlords having to be creative, it’s a great time to start a business.”

Generation Next is a club for the rising stars in hospitality. For information on how to join or the next club events, contact wb.jnggne@jeoz.pbz

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