Escoba Bistro is Closing Down

[GGG]

Why do we attribute every failure to the bust in the economy. I'd say the huge increase in lease rates during the boom is the primary cause.

Calgary has lots of mediocre over priced food out there. This economic slowdown should push lease rates and menu prices back down to something more reasonable.

[CliffFletcher]

Originally Posted by GGG

Why do we attribute every failure to the bust in the economy. I'd say the huge increase in lease rates during the boom is the primary cause.

Calgary has lots of mediocre over priced food out there. This economic slowdown should push lease rates and menu prices back down to something more reasonable.

Yep. Lease rates were set for a crazy boom when patrons gushed discretionary spending. That's not hapening anymore, but the lease rates haven't fallen fast and far enough.

And you would think prices would start coming down at some point. It should be getting cheaper to hire people than it was during the boom. Of course, the minimum wage legislation could throw a spanner in that natural adjustment.

[Reaper]

Originally Posted by CliffFletcher

Yep. Lease rates were set for a crazy boom when patrons gushed discretionary spending. That's not hapening anymore, but the lease rates haven't fallen fast and far enough.

And you would think prices would start coming down at some point. It should be getting cheaper to hire people than it was during the boom. Of course, the minimum wage legislation could throw a spanner in that natural adjustment.

It wouldn't be cheaper to hire servers. They are already paid minimum wage.

[c.t.ner]

Originally Posted by CliffFletcher

Yep. Lease rates were set for a crazy boom when patrons gushed discretionary spending. That's not hapening anymore, but the lease rates haven't fallen fast and far enough.

And you would think prices would start coming down at some point. It should be getting cheaper to hire people than it was during the boom. Of course, the minimum wage legislation could throw a spanner in that natural adjustment.

I'd say that we won't be seeing any price adjustment in favour of the consumer side moving forward. I've noticed that over the past 6 months, pretty much every dish at a restaurant (that isn't a Denny's) starts at 15-16 dollars now (and averages about 17-19 dollars) and pretty much every "fast food" restaurant has combos that hover at the $10 mark in the city. Which is a pretty noticable change since last year.

[Flames in 07]

Originally Posted by PsYcNeT

So isn't this just the free market being exercised?

I don't see the problem. It's not like every other restaurant that no one ever goes to closed up. Dog eat dog world man.

The other dogs should be better restaurants with better products or services. Not the layers of government making business harder and harder.

[Hack&Lube]

Given that most restaurant leases are for 5 to 10 years, many of which were set during the crazy years, a lot of people are locked into terrible lease rates and getting out via an exit clause or bankruptcy may be the only way.

This is a bit of a market correction just like what you see with O&G. The lease rates for commercial retail tenants need to drop in this town to support some vibrant businesses. The big tenants and office towers have all dropped their rates significantly as we are looking at something like 25% vacancy but the retail and small side of commercial is still jacked up.

Mom & Pop shops are more desperate to make money, with little to fall back on, and landlords are exploiting that.

[peter12]

Originally Posted by GGG

Why do we attribute every failure to the bust in the economy. I'd say the huge increase in lease rates during the boom is the primary cause.

Calgary has lots of mediocre over priced food out there. This economic slowdown should push lease rates and menu prices back down to something more reasonable.

Moving to Vancouver, I can support this statement. This city has about 200 times more bars, restaurants, dives, noodle joints, dumpling houses. All better quality, and probably 15% lower prices.

[Lubicon]

Originally Posted by Hack&Lube

Given that most restaurant leases are for 5 to 10 years, many of which were set during the crazy years, a lot of people are locked into terrible lease rates and getting out via an exit clause or bankruptcy may be the only way.

This is a bit of a market correction just like what you see with O&G. The lease rates for commercial retail tenants need to drop in this town to support some vibrant businesses. The big tenants and office towers have all dropped their rates significantly as we are looking at something like 25% vacancy but the retail and small side of commercial is still jacked up.

Mom & Pop shops are more desperate to make money, with little to fall back on, and landlords are exploiting that.

Agreed. Landlords need to understand they can take either less $$$ for their space or they can take zero. The place I work falls under the small commercial scale I guess. Our space downtown is up for renewal (we used to take about one floor but are now probably closer to 1/2 s floor in our building). Landlord isn't budging an inch for the renewal and claims it's business as usual in Calgary and there is no downturn in the market.

[OMG!WTF!]

Commercial landlords are weird that way. Some would rather sit empty than lower rates. I suspect in some cases it is because the lease rate is the cap rate and the cap rate directly effects the value of the property. It makes it hard to sell when the income can't justify the asking price. A vacant property would be easier to sell than one rented long term at a low rate.

[rain_e]

Originally Posted by OMG!WTF!

Commercial landlords are weird that way. Some would rather sit empty than lower rates. I suspect in some cases it is because the lease rate is the cap rate and the cap rate directly effects the value of the property. It makes it hard to sell when the income can't justify the asking price. A vacant property would be easier to sell than one rented long term at a low rate.

Exactly. It's all about the cap rate when it comes to commercial properties.

[Locke]

Originally Posted by Lubicon

Agreed. Landlords need to understand they can take either less $$$ for their space or they can take zero. The place I work falls under the small commercial scale I guess. Our space downtown is up for renewal (we used to take about one floor but are now probably closer to 1/2 s floor in our building). Landlord isn't budging an inch for the renewal and claims it's business as usual in Calgary and there is no downturn in the market.

Theres also a disconnect between actual landlords and their property management companies. My landlord switched companies and just about lost me until I went over their heads to the actual owner.

[Regular_John]

Originally Posted by GGG

Why do we attribute every failure to the bust in the economy. I'd say the huge increase in lease rates during the boom is the primary cause.

Calgary has lots of mediocre over priced food out there. This economic slowdown should push lease rates and menu prices back down to something more reasonable.

I really don't see the cost of eating out going down, but there's definitely a more then a few mediocre restaurants here that survived off the surplus cash from the O&G crowd. I know I've paid $70+ for a meal that should have been closer to $50 in terms of quality, but was packed with the corporate crowd charging it to the company card.

[Fuzz]

Originally Posted by jaydorn

I really don't see the cost of eating out going down, but there's definitely a more then a few mediocre restaurants here that survived off the surplus cash from the O&G crowd. I know I've paid $70+ for a meal that should have been closer to $50 in terms of quality, but was packed with the corporate crowd charging it to the company card.

Ah, so you went to the Chophouse, too?

[vjeffriess]

Escoba reopened last Tuesday if anyone is interested

[Locke]

Originally Posted by vjeffriess

Escoba reopened last Tuesday if anyone is interested

Same location?

[troutman]

We ate there September 8th. It was really dead and food was so/so.

They may hope to get good traffic from the Calgary Film Festival.

[shermanator]

The owner better be prepared for failure, because there's still a bike lane on 8th ave.

[GordonBlue]

Originally Posted by vjeffriess

Escoba reopened last Tuesday if anyone is interested

same owners, or family of?

[wireframe]

Oh, good. That crappy restaurant exists again. I can't wait to hear them complain about the government ruining their business.

[vjeffriess]

Originally Posted by GordonBlue

same owners, or family of?

Darren still owns the building, but there are new owners (that worked there when it was open previously - Laurel and Brad). Some of the old menu is still there and much of it is updated. They are doing half price appetizers 3-7 every day and $9 wine for the first few opening weeks. Same location on 8th ave.