How food halls will find their groove again

Food halls will be among the last dining destinations to reopen in most of the world. The models for these massive, multi-concept operations rely on vendors in close proximity, high customer traffic and communal tables, making it difficult to enforce safety protocols. Industry naysayers believe the model is unsustainable post pandemic, at least in the short term. That may be the reason for the recent closure of Foodlife, a food hall that parent company Lettuce Entertain You Enterprises says was Chicago’s first. 

Food halls have evolved considerably in the 27 years since Foodlife opened, and many of today’s operators are optimistic. Halls that were in development before the pandemic are moving ahead with opening plans, and operators of established ones have been busy upgrading technology, rethinking their space and strategizing safety guidelines.

Didier Souillat, CEO of the six Time Out Markets worldwide, hasn’t reopened any of these food halls yet, but expects Lisbon to be the first, followed by Montreal. “It’s challenging in the U.S. as the regulations change from state to state and, often, city to city,” he says. In June, he was aiming for late July or August to reopen locations in Chicago, Boston, Miami and New York. “We only have one shot at opening and we have to make sure it’s the right time,” he says. “[Time Out] lost a tremendous amount of money during the shutdown, and we don’t want to open and close again.”

A new customer experience

When they do reopen, Time Out Market’s dining experiences will look and feel very different. An ambassador will greet customers at the door to explain the new health and safety protocols; complete instructions about social distancing, ordering and sanitation will be posted in the entrance vestibule; and cleaning crews will be clearly visible in bright yellow vests.

In addition, “we have a footfall counter in the buildings, and the counts show up directly on the GM’s smartphone,” Souillat says. “When capacity comes within 10% of the 50% limit, the counter sends out an alert.”

During the shutdown, Time Out developed a new app that allows customers to preorder, come in and immediately sit down instead of going up to vendors’ stalls as before. “They will still be able to go up to the counter and talk to the chef, but it’s optional,” Souillat says.

The concept’s long communal tables will be placed six feet apart with colored glass partitions between parties. “Time Out Chicago is 50,000 square feet, so there’s plenty of room for social distancing without losing the buzz that makes food halls unique,” Souillat says. “And since Time Out is a media company, we are inscribing the partitions with information about what’s happening in the cities where we’re located.”

Photograph courtesy of Time Out Market

The Boston and Chicago locations have outdoor terraces that can safely accommodate more customers, and most Time Out food halls will launch curbside pickup and delivery, leaving the option up to individual vendors. “We are doing all we can to give our vendors more summer sales,” Souillat says. Time Out’s “no revenue, no rent” policy means the food halls’ tenants did not incur expenses during the shutdown, though they did lose revenue.

Off-premise’s staying power

Social Eats in Santa Monica, Calif., stayed open throughout the pandemic, pivoting the business at least six different times, according to John Kolaski, founder, curator and CEO of K2 Restaurants, which operates the food hall. “One of our first steps was implementing a contactless solution so guests can order ahead for takeout and delivery,” he says. Social Eats’ online-ordering platform consolidates all nine concepts into a single POS system, allowing customers to combine items from all or some of the vendors into one to-go bag.

“One POS system helps generate food sales for individual restaurants, whether fully able to open or not, and limiting the number of registers can help ensure proper social distancing and non-contact measures when we reopen for indoor dining,” Kolaski says.

Photograph courtesy of Social Eats

With its location on the Santa Monica pier, Social Eats was able to provide a pedestrian entrance in the front for takeout orders, complete with social distancing markers, and a separate drive-thru in the back for curbside pickup by car. K2 also organized its own delivery team, cross-training workers who were assigned to other jobs. “That allowed us to keep everyone employed during the pandemic and offset the need for and costs associated with third-party companies,” Kolaski says. “Takeout and self-delivery are here to stay and will help us survive through the winter.”

Perks for customers and chefs

Akhtar Nawab, an award-winning restaurant chef and CEO of Hospitality HQ, had plans in the works for Dr. Murphy’s Food Hall months before coronavirus rocked the industry. He’s still on target to open this August in Chicago’s old Cook County Hospital building, filling the historic space with 10 chef-driven concepts and a bar.

“I was fortunate because I already had [Inner Rail] Food Hall in Omaha, Neb., and made some changes there for post-COVID operations that I’m applying to Chicago,” he says. Like Kolaski, he changed up his POS system, working with a provider to create new software for contactless ordering and payment. “Customers can come in, take a seat and place their order. A server then brings the order to the table,” Nawab says.

Photograph courtesy of Dr. Murphy's Food Hall

Another new feature is a concierge center for off-premise orders. Customers order online and come to pick up their food at this designated area, much like Sweetgreen’s outpost program, Nawab says. This should prove especially convenient for the healthcare and biotech workers concentrated in the area.

Hospitality HQ is also offering perks for vendors. Although buy-in costs for a food hall stall are traditionally much lower than for a brick-and-mortar restaurant, Nawab feels it’s especially important right now to support chefs—many of whom have lost their restaurants or life savings.

“We built in a vendor grant program to absorb the startup costs, which run $15,000 for a non-vented space and $35,000 for a vented stall,” he says. Applicants who are chosen earn the right to open a stall for an 18-month term; if they complete 12 months, the fee is waived. All costs except food and labor are taken care of by Hospitality HQ as well.

“Our goal is to provide an artisanal food experience to the community and the opportunity for newer chefs to succeed,” Nawab says. Signed up so far are concepts offering everything from Nepalese/Burmese momos to fried chicken sandwiches.

Into the future

Budd Dairy Food Hall, a Columbus, Ohio concept in development from Cameron Mitchell Restaurants (CMR), had to delay its opening from May 5 to late August. “It was important for us to get our existing restaurants open and operating under all the safety protocols before we could turn our attention to Budd Dairy,” says Steve Weis, vice president of development for CMR. But all 10 chef-partners who had originally signed on remain. “They have been so patient and understanding about the reasons for pushing back the opening and are excited to launch, but join us in wanting to make sure we do it safely.”

Budd Dairy will ease into opening by limiting service to happy hour and dinner in the beginning. Tables will be socially distanced with plexiglass dividers, and guests can order online from any of the eateries and three bars without moving from their seats. Customers will receive a text when their food is ready to be picked up; drinks from the bar will be hand-delivered by a server. The 16,000 square-foot-space also features a beer garden and rooftop deck.

Photograph courtesy of Social Eats

Marketing will focus on the size of Budd Dairy, promoting the ability for guests to really spread out, as well as its novelty, Weis says. “We are offering something that doesn’t exist in Columbus—10 different concepts created by 10 extremely talented chefs all under one big roof.”

Other operators are likewise looking up. “I’m very bullish on food halls,” Nawab says. “They have enough seating and space, so even if they are at 50% capacity, they still have good energy.” When Dr. Murphy’s 10,000-square-foot space is half full, that adds up to 100 patrons, plus there’s an outdoor patio. Next up for Hospitality HQ is Lyric Market, a food hall in Houston. Going forward, automating as many processes as possible is a priority, he says.

Time Out “will continue building big spaces and outdoor terraces,” Souillat says, noting that new markets are on the docket in London, Prague and Dubai. “I believe in food halls, especially with the environment we’re in at the moment.”