CW Retail - Food Halls Report

FOOD HALLS OF AMERICA

multifamily or hospitality projects. Tenant mixes are generally weighted towards prepared food vendors, although many of these projects feature a healthy mix of unprepared food vendors as well. The real estate model for these projects is similar to that for food halls as a whole (see above). Deals are usually shorter term, although in the case of mini food halls most of the concepts in our report have leases of one to three years with subtenants) and, again, often include common area mainte- nance charges for communal dining and/or cooking, preparation, freezer/cooler or office space. Emporiums Not all food emporiums are food halls, but many larger projects definitely fit the bill. Dean & DeLuca, for example, has 11 U.S. locations and since 1977 has been one of the nation’s premier culinary emporiums. Their major retail locations typically offer catering services and many have cafes (eat in) as well. Our view is that they are more emblematic of the related, but much different, “grocerant” trend in the U.S.—the rise of large, prepared food sections within grocery stores, particularly more upscale grocers such as Whole Foods and Bristol Farms, among others. However, just as the current food hall movement owes much of its initial inspira- tion to Harrods Food Hall in London, the single purveyor concept of Eataly is what has helped to jumpstart this movement in the U.S. and remains a major driver. We anticipate continued aggressive growth from players like Eataly, Todd English and other chef-driven concepts.

Even in the U.S., this “brand new” concept of food halls is actually centuries old. The sudden popularity of food hall projects has only muddied the waters in terms of definitions.

Mini Food Halls The mini food hall is a new trend that only began to emerge in late 2015. This project is typically 10,000 sf or less and tends to be located in freestanding urban locations or on the ground floor of major urban office,

The real estate model for these projects is substantially different than for both

CUSHMAN & WAKEFIELD

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