D&D London’s David Loewi: “This deal is about us getting our mojo back”
In the past year D&D London has shuttered 17% of its estate, including its Avenue, Cantina Del Ponte, Radici, Plateau and Haugen restaurants in the capital, as well as East 59th in Leeds and Klosterhaus in Bristol.
Loewi says that the sites that have closed were not performing in line with the rest of the D&D London business, which is set to turn over £144m next year.
"The board was in full agreement about which sites were working and which ones weren’t. There are lots of headwinds at the moment. My view was that if a restaurant was borderline, it was better to focus on the restaurants that are making money and make them even better.”
A number of the restaurants that have closed - including Klosterhaus and Stratford’s Haugen - only opened within the past few years.
Loewi says that both these projects are “casualties of Covid” having been hit hard by the pandemic and its aftereffects, namely working from home constraining the corporate market.
“The world has changed. Both those deals were made before Covid. If you stand on Haugen’s rooftop and look into the surrounding office blocks they are all empty. The social market is still there, but that is not enough for Haugen to succeed. It is too big a restaurant.”
Loewi says he is pleased with the performance of the group's current estate, pointing to what is set to be a record-breaking Christmas period. D&D London's parties and events business is on track to generate over £5m in December.
The City is trading especially well over December, Loewi says, with the group's Madison and 14 Hills restaurants seeing over 20% growth vs last year. The company will finish this week (ending 17 December) on 48,000 covers, up nearly 30% on last year.
Patient capital
The £60m investment from Calveton and Breal has resulted in a £40m balance sheet recapitalisation which the group says will give it ‘a clear runway for continued success and further growth’.
While Loewi is looking at new opportunities in locations including London, the UK more generally and New York, he is for the moment primarily focused on D&D London’s existing estate, which includes the likes of Quaglino's, Angler, Launceston Place, German Gymnasium and Sartoria.
“I want to carry on building them and looking after them,” he says. “There is a chance we will open something next year. I am being approached by a lot of landlords. The appetite is there from us, it is just a question of identifying the right opportunity.”
Unlike a traditional private equity backer, Calveton and Breal have invested proprietary capital ‘patient’ money, meaning there is less pressure for the business to expand.
“Patient money means that you have investors that care about the business," Loewi says. “They realise that we are not currently in the easiest economic cycle and that this is a time to nurture the business and look after the teams rather than say ‘we need this many new openings by this date’. The deal is very positive for us because both the buyers understand and respect the DNA of the business.”
A full interview with David Loewi will be published next month
