Our area is a growing one, and while there is always some turnover in the hospitality industry we have largely had the pleasure of having many new and exciting options for eating and drinking. Every once in a while a fantastic and promising option that seems like it’s bound to stay fails however, and it leads us to scratch our heads and wonder what happened. This was just the case in Phoenix recently.
The Pemberton was one of the better additions to Roosevelt Row: an outdoor venue that was a collection of different food trucks and alcohol-serving vendors with quirky and fun lighting and seating. It also served as a centerpiece to the area’s First Friday festivities. But soon it will be no more.
Restaurants and bars come and go and we rarely bat an eye at it. It is the nature of a fast-growing area to have massive turnover in this industry. This one felt different however; it felt like an idea that was so well-executed on that it was bound to work.
So what happened? Since the owners didn’t comment further it’s tough to tell. But many Roosevelt Row locations have had a rough go at it recently: recent occurrences can be found here, here, and here. Clearly there is a serious trend here, one that is of a higher frequency than other areas.
We are prompted to consider two possible reasons why: one, perhaps food traffic is down far enough that revenue is not keeping up with projections, or two, lease payments are so exorbitant that businesses are not able to keep up. Perhaps both. Setting up shop in Roosevelt Row has been an expensive endeavor for a while; considering the massive amount of turnover, one would think that landlords would adjust rent appropriately and help foster new businesses. After all, looking for new tenants regularly isn’t ideal for them either.
But perhaps it’s a revenue problem. After all, Roosevelt Row is no longer the only game in town when it comes to funky artisanal vibes. As long as First Fridays is there, one day a month will always be a great evening for revenue, but that can only go so far.
It seems as though it is a Come To Jesus Moment for both the landlords in the area as well as businesses thinking that they’re the ones who can make it work. It’s not working. The degree of turnover in the district isn’t healthy for anyone. Perhaps it’s time for businesses to look elsewhere unless landlords are willing to give massive concessions.