The shift in city dynamics

There was a time when it was possible to secure a table at popular restaurants and bag a seat in the more fashionable bars in London without too much trouble. But, over the years, things became ever more difficult and a night out has required meticulous planning months in advance if you are particularly selective about where you want to spend your time and money. Although the issue has not been quite as acute for inhabitants of other major cities, they have not been immune from suffering similar problems.

Transport systems have also creaked at certain peak times and this, again, required some planning ahead and the taking of alternative routes if headaches were to be avoided. What it, ultimately, meant was Friday and Saturday nights in central London became largely limited to special occasions when the requisite preparation and bookings had been made seriously well in advance. 

At the heart of the problem was simply the number of people living in and visiting London – for both work and pleasure – and the other major UK cities too. The population in the capital has grown significantly over recent years. When I arrived in about 1990, the population in Greater London was below seven million whereas 30 years later it had reached the nine million mark. This growth has been predicted to continue, according to the Greater London Authority, which is forecasting it will hit the ten million level by 2030.

It might have to get its calculator out again because a hole has just been blown into its forecasts, caused by a combination of covid-19 and Brexit. Analysis by the Economic Statistics Centre of Excellence has found an estimated 1.3 million foreign-born workers have left the UK during covid-19, of which as many as 700,000 were in London. 

The ramifications for leisure and hospitality look significant. For starters, almost 160,000 of these people have left or lost jobs in these sectors. When restaurants start to get back on their feet then the employment shortage will present itself as one of the numerous serious issues to overcome. For Des Gunewardena, chief executive of D&D London, his restaurants will have to operate on the basis of “fewer people and different working practices”.

The latter will be a particularly interesting point because the long shadow of covid-19 will, no doubt, affect customer behaviour for some time. They will likely demand greater space because questions will remain over when they will again be comfortable with cheek-by-jowl dining where tables are packed closely together? The economics of cover numbers and table turning will, therefore, need appraising – following those initial trials undertaken during the confusing tier-juggling exercise of last year.

There is also the significant issue of major cities simply having fewer people in them for the foreseeable future and the obvious resultant drop-off in demand for foodservice in all its guises. For every foreign-born worker that has left the major cities, there is another British citizen who has jumped ship and moved into a more countrified location. There are also the many younger people who have returned to their families and, on top of this, the work-from-home scenario is an uncertain dynamic that has yet to be played out.

With the impending end of the eviction moratorium, sites of all varieties will inevitably become available and for those with the financial firepower there will be opportunities to potentially take much roomier venues, maybe even adding bar areas into restaurants alongside the dining room – just like in the good old days when rentals allowed such largesse.

We might be on the cusp of a once-in-a-lifetime “land grab” in London and the other major cities for those with meat on the bones of their balance sheets. But, along with the favourable real estate market conditions, these bold operators will also have to deal with the fact there will also be fewer people around to service. If I’m one of them, maybe I might just be able to again return to eating and drinking in the more fashionable and popular places in town.

Glynn Davis, editor of Retail Insider 

This piece was originally published on Propel Info where Glynn Davis writes a regular Friday opinion piece. Retail Insider would like to thank Propel for allowing the reproduction of this column.