INSIDE: L.A. Restaurants Begin to Experience Return of Diners

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L.A. Restaurants Begin to Experience Return of Diners

By DEBORAH BELGUM

Staff Reporter

Business is recovering at Los Angeles restaurants stung by the economic downturn and a loss of customers due to the Sept. 11 terrorist attacks.

Owners are bracing for another relatively rough quarter but see a return to pre-downturn numbers by mid-2002 as tourists slowly return and local diners start to spend more.

“We are starting to come back,” said Alan Redhead, who runs Gladstone’s 4 Fish, the popular eatery perched along the coast in Pacific Palisades and the area’s top-grossing restaurant, according to this year’s Business Journal survey. Open since 1972, Gladstone’s traditionally has been a popular seafood spot for tourists, locals and Hollywood types.

“Just in the last week our customer counts have been where they were a year ago. But the average check is off eight or more percent,” he said. “Naturally we have less tourist business, especially the Japanese. But we are noticing more local business.”

Redhead’s sentiment was echoed by restaurant owners throughout the L.A. area. While September and October were tough, November and December are looking better.

“Things should be back to normal by this summer,” predicted Janet Lowder, president of Restaurant Management Services.

However, the restaurant business is still going through sluggish times, depending on whether restaurants cater to tourists and affluent clients or local families.

“I think business is definitely getting better every day, but it is just getting back to the level of last year,” said gourmet chef Joachim

Splichal, who founded the Patina Group when he opened the Patina restaurant in 1989. He and his wife, Christine, also operate six Pinot restaurants and Nick & Stef’s Steakhouse in downtown L.A.

Splichal said some of his restaurants’ revenues are up and some are down, depending on location. Tourist-oriented eateries, such as Catal Restaurant & Uva Bar near Disneyland or Pinot Brasserie in Las Vegas, have seen a slide in revenues. Same goes with Pinot Hollywood, located near Paramount Studios, where security has been heightened in the wake of the Sept. 11 attacks. Business is down at Nick & Stef’s due to reduced business travel and competition from Morton’s of Chicago, a new steakhouse that opened in the downtown area on Figueroa Street.

Home for the holiday

Thanksgiving Day business at the Patina Group restaurants was up 26 percent over last year, presumably because more people were staying at home. While Splichal expects business to be soft during the first part of the year, he is going ahead with plans to open a new restaurant next month in downtown Los Angeles.

Zucca, at 801 S. Figueroa St., has been planned for two years. With Italian cuisine and a country-like Italian ambience, it is expected to capitalize on traffic from the Staples Center and the L.A. Convention Center.

“I am definitely nervous about it,” Splichal said. “But I am nervous even in good times.”

Gladstone’s is not curtailing its expansion plans either. Redhead said he is on track to open a new Gladstone’s 4 Fish at the Long Beach waterfront in two years. The 10,000-square-foot restaurant will be near a new retail complex still being planned near the Long Beach aquarium. “We think this downturn is going to be a blip and will come back strong,” Redhead said.

Plans for Puck

Likewise, Wolfgang Puck still plans to open four express outlets within the next two months in Colorado, Florida, Hawaii and Nevada. He also is opening a new Spago restaurant on Dec. 15 at the Four Seasons Resort Maui.

But Puck’s business is still fighting to return to last year’s level. “It will take some time before people feel more comfortable about going out. It could take six months to a year,” said Jannis Swerman, a spokesman for Puck.

At Lawry’s, the Prime Rib, ranked second on the Business Journal survey, business has fallen because of a drop in Japanese tourists, who aren’t traveling to the United States. But it has been helped by local residents.

“One piece of our business that is missing is the tourism element, which makes up about 5 percent of our business,” said Richard Franks, chief executive of Lawry’s. “And in our case it is Asian, primarily Japanese tourists.”

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