The closure this week of the Fallon & Byrne upscale foodhall and restaurant in Rathmines caused much wailing and gnashing of teeth across leafy Dublin 6, and beyond.
On Friday evening, further rumours were emerging that a second well-regarded Dublin restaurant was about to hit the wall, following in the footsteps of others such as Luna. Outside of the capital, another foodie haven, L’Atmosphere in Waterford, also shut this week.
Why are well-located, fashionable food venues hitting the buffers during an economic and consumer boom? We can, at least partially, blame the internet.
Away from the usual Zone A prime retail areas, a major change is under way. Many specialist traditional retailers, such as music shops and bookstores, are closing due to relentless competition from online retailers.
There are not enough new bricks-and-mortar retailers to take the places of the damned, and the ones that are willing to do so want the rent cheaper than the last guys who went bust. So landlords are turning instead to cash-rich food and beverage businesses to meet the high rents they need for enough yield to pay the bank.
Where once you might have found a stationery shop, now you’ll find a cafe. Where once there was a butchers, now there might be a vegan restaurant. From a planning perspective, official change of use from traditional retailing to food and beverage use is extremely common.
But while food and beverage businesses are cash-rich in the short term (almost nothing is sold on credit), they often struggle for profitability in the long term.
In central Dublin, where eateries have been replacing retailers for the last three or four years, the extra competition in the restaurant sector is now starting to tell. And that’s before you even begin to factor in the competitive effect of eat-at-home apps such as Deliveroo and Just Eat.
Fallon & Byrne, located in the Swan Shopping Centre in Rathmines, was unprofitable from day one, so its owners took the decision to pull the plug after less than three years. It does not bode well for others in the sector.