Dozen new restaurant outlets headed for downtown L.A.

Opportunities grow with office workers, visitors

Nearly a dozen restaurant outfits are checking out sites for outlets in downtown L.A. to serve a growing population there of office workers and out-of-town visitors.

Restaurant business downtown declined in the early 1990s, said Mark Tarczynski, a retail property specialist in the downtown office of CB Commercial Real Estate Group Inc. The recession hit, tourism slumped, companies in the downtown skyscrapers laid off workers in droves -- and restaurateurs suffered, he said.

But now office leasing activity downtown is picking up, and there are more people working there who need to eat, Tarczynski said. Also, consumers are returning to eating out now that the economy is improving. And the expanded Convention Center is supplying thousands of hungry tourists, he said.

Half a dozen quick-serve eateries are either negotiating for or have already leased space downtown. These are McDonald's Corp., In-N-Out Burger, Burger King Corp., Wall Street Deli Inc., Au Bon Pain and Monterey Pasta, said Tarczynski, who is representing these tenants.

In addition, five full-service restaurateurs are either looking for space or have already leased it. One is Tesoro, a high-end Italian eatery, opening a 6,000-square-foot eatery in October in California Plaza on Grand Avenue, Tarczynski said.

He said he also represents four other full-service restaurateurs eyeing space downtown, but he would not name them.

A 6,000-square-foot Burger King franchise is opening within the next two weeks at the corner of 7th and Flower streets, said Burger King spokesman Michael Evans. The Miami-based chain already operates one outlet in downtown L.A.

Meanwhile, Irvine-based In-N-Out Burger is in "various stages of negotiations" to open two or three outlets in downtown L.A., said Steve Roth, the company's director of real estate. In-N-Out does not presently have any outlets in the area.

"We are actively pursuing several sites, but we don't have anything under lease," he said.

One outlet might be located inside an office building, while others may be full-sized, with 70 seats and a drive-through, he said. The outlets would probably open by mid-1995.

In-N-Out officials would use the performance of these outlets to determine whether to venture further into the downtown L.A. market, Roth said.

Downtown L.A. is a "very obvious" market that In-N-Out hasn't penetrated yet, Roth said.

Atlanta-based Wall Street Deli is negotiating on three 3,000- to 4,000-square-foot spaces in downtown L.A., said company President Alan Kaufman.

The coffee shop/deli chain, which operates 120 outlets nationwide, has been successful in downtown locations in such markets as Chicago, Washington, D.C., and Philadelphia. Downtown Los Angeles is its next target, Kaufman said.

McDonald's is also negotiating for space in downtown L.A., said Kevin Mazzu, marketing manager for McDonald's Los Angeles region. However, he would not specify how many sites are involved. McDonald's already operates seven outlets downtown.

In addition, Boston-based Au Bon Pain, a bakery and cafe chain, is looking for a 2,500-square-foot space inside a downtown office building.

"As soon as I can find a location that's acceptable to us, we'll go downtown," said Ed Schwartz, director of real estate for the chain's West Coast operations.

Au Bon Pain operates 220 units nationwide. The chain has one outlet in Pasadena and plans to open one this month in Topanga Plaza in Woodland Hills and another soon in Cerritos, Schwartz said.

Danville, Calif.-based Monterey Pasta is negotiating for two sites in downtown L.A. and is searching for a third suitable site, said Darryl Deaton, director of site acquisitions for the quick-serve pasta chain.