Many new developments have taken shape in commercial real estate. The rising demand for eCommerce, the changing landscape of industrial needs, the increased focus on office amenities, and the shift to an 18-hour work-live-play environment, to name a few.
One particular trend has found its niche and began to provide immense value amid these changes – food halls. This concept of an open eatery food hall has emerged as one of the fastest-growing retail trends for 2019. The market has seen so much growth in recent months that Globe Street is calling 2019 “The Year of the Food Hall.”
The initial idea for these open eateries was to utilize properties in dense, urban areas while bringing ‘foodies’ all under one roof. However, the increased popularity of these has caught the attention of suburban malls and corporate offices in the downtown business scene. The idea of food halls offers numerous benefits:
- Opportunity for chefs to test new dining concepts
- A space for existing restaurants to expand
- A unique experience for consumers to enjoy high-quality dining options outside the traditional restaurant
- Blending the food and retail experience into one overarching outing
Unlike conventional food courts found in malls where you’ll find everything from grab-and-go items and fast food diners to chain restaurants, food halls are more of an incubator for members of the culinary industry. With a mix of locally grown cuisine, popular food truck eats, trendy butcher counters and more eclectic food options, food halls are considered to be the future for entrepreneurial eateries and vendors who may have food options with a relatively short shelf life.
Food Halls and the Commercial Real Estate Industry
- To ensure success, landlords and developers must understand that food halls require complicated operations, and location means everything as they thrive in areas with high foot traffic.
- As today’s narrative about the retail sector seems to be dominated by stories of closures and downsizing storefronts, experiential retail has become the main focus, and food halls perfectly fit this mold.
- The need for amenities to keep consumers engaged is more important than ever before, and food halls can deliver one of the most attractive, unique new offerings for residents and workers, especially in mixed-use properties.
- Restauranteurs have the opportunity to operate with lower overhead and shorter lease terms.
- Food halls boost activity and attract new customers, making them a great way to fill the void of vacant big-box retail prime for development, industrial buildings, malls, etc.
At the end of 2017, 118 food halls were opening across the U.S., and today it’s estimated there will be nearly 300 by the end of 2020. As food halls slowly start to work their way into mixed-use spaces across the nation, it not only offers the promise of increased foot traffic but makes mixed-use properties even more desirable. With so much growth already taking off with food halls across the country, there is no doubt that this trend is here to stay.