Cities that Sizzle

Nation's Restaurant News, Jan, 2001

In outlining Chicago's positive attributes for restaurant operators, Melman cites a good business climate, fair rents, a healthy convention and tourism business and "one of the great mayors in the country."

Melman says Mayor Daley was responsible for getting him excited about the burgeoning downtown theater district. "We're going to put a restaurant down there," says Melman, who, fearing a lack of dinner business, previously avoided the heart of downtown.

Larry Levy, whose restaurants consistently perform well, says out-of-towners find Chicago eateries to be a better value than many of their counterparts in other large cities, "We are giving wonderful experiences at a good value, and the future looks terrific," he says.

As Chicago's reputation for being a good restaurant town has spread, an increasing number of high-profile regional operators based elsewhere have opened branches here, including Smith & Wollensky Restaurant Group, Wolfgang Puck's Spago and Xando/Cosi. And, of course, countless national chains in all segments have multiple units in this market.

Brinker International, for example, operates close to 70 units in all but one of its concepts. "It's a huge metropolitan area and a key market with strong demographics and growth," says Brinker spokesman Tim Smith. "We definitely see additional growth potential for all of our concepts in Chicago in the future."

Smith partially credits Brinker's partnership with Lettuce Entertain You for its depth in the market, especially for the growth of LEYE-originated concepts Maggiano's Little Italy, Coiner Bakery and Big Bowl. Corner Bakery alone has 29 outlets in the Chicago area.

Calabasas Hills, Calif.-based Cheesecake Factory is planning to open one of its new Grand Luxe Cafes in downtown Chicago next summer. Howard Gordon, senior vice president of business development, reports that The Cheesecake Factory on North Michigan Avenue is the highest-grossing restaurant in the chain at $17 million, well above the chainwide average unit sales of $10.3 million.

"Chicago is a great food town," Gordon says. Working in its favor are population density, considerable walk-by traffic and a price-value consciousness that appreciates The Cheesecake Factory's large portions and vast menu selections.

New downtown developments are attracting still more restaurants. The high-profile North Bridge project is a 10-square-block, mixed-use development just west of North Michigan Avenue and centered around a Nordstrom department store. Gary Merdinger, principal with North Bridge developer John Buck Co., expects the new project's restaurants to do very well.

"People who live downtown have higher incomes and are busy working, so they are more willing to buy restaurant meals," Merdinger says. "If the city population continues to grow, the restaurant trade should grow with it."

Considerable new development is taking place all over downtown, according to Marie Bousfield, demographer with the Chicago Department of Planning & Development. "We can't keep up with the building permits," she says.