“With the right kind of eyes you can almost see the high-water mark — that place where the wave finally broke and rolled back.” — Hunter S. Thompson, Fear and Loathing in Las Vegas
It’s a drizzly Friday night in winter. A couple huddle under the awning of a busy restaurant, scrutinizing the display menu while the red, yellow and green of the traffic light flickers through the bubbles of rain that have gathered on the fogged windowpanes. Inside, the tables are full, and a line butts up to the door; even outside, you can hear the muffled chatter within. The couple move on.
On an average night in tourist season, Asheville looks slammed. There are lines at many of the more than 100 downtown eateries, and places like Cúrate and Cucina 24 may have reservations booked months in advance. But as the restaurant scene continues to balloon, it begs some questions: When do we reach the peak? When does the market become so saturated that it simply can’t hold any more? When do those tables begin to sit empty? Is the bubble is about to burst?
On a national level, statistics show that certain sectors of the restaurant industry are in decline. A 2016 study by the NPD Group reports that the total number of independent restaurants in the U.S. fell 2 percent that year, with the steepest downturns in the full-service and quick-service categories. But is Asheville, with its booming tourist trade and tight-knit community of restaurateurs, following that trend?
“I do feel as though Asheville is a very special market, and it has truly achieved heights that I have always wanted to see it reach,” says Vijay Shastri, whose Flying Frog Café, a downtown anchor for over a decade, shuttered in 2011. Since then, the city’s restaurant scene has blossomed from a handful of reputable chefs to an onslaught of James Beard Award nominations and top ranking after top ranking. Everyone from Frommer’s to National Geographic Explorer to Bon Appétit has sung the city’s praises.
“The real issue with Asheville is the sheer amount of places,” Shastri continues. “There are way too many restaurants for the amount of people there are. The amount of tables that are available year-round does not match the amount of feet that are available year-round.”
After the Flying Frog’s demise, Shastri tried his hand at another local venture: Mr. Frog’s, on South Market Street. But a year later, he left town to launch a consulting career in Highlands; he now has clients all over the country. And more often than not, Shastri’s advice to entrepreneurs looking to invest in restaurants here is don’t do it.
“It’s less risky to do business in a place like New York City than it is in a place like Asheville,” he observes. People who lack the initial capital, Shastri maintains, “are drawn to places like Asheville where, as restaurants come and go, it can be relatively easy to pick up a restaurant for a fairly small amount of money. The setup cost is small, but the return is not good.”
Cream rises to the top
Other local restaurateurs take the opposite view.
“Our feeling has always been the more restaurants, the more good press for Asheville — and the better for us,” says Charlotte Fahy, who manages all five restaurants in Chai Pani’s mini-empire. From its initial 13-table eatery downtown, the Chai Pani Restaurant Group has grown to include MG Road, Buxton Hall Barbecue and two Atlanta outposts. “The more Cúrates and Limoneses and Rhubarbs that open where people are having these nice dinners, they have to eat somewhere the next day,” she points out. “So with our fast-casual model and lower price point, we’ve always felt pretty positive about that.”
Amber Arthur, who founded Izzy’s and BattleCat Coffee Bar as well as PennyCup Coffee, takes a similar view. Asked if Asheville’s dining scene is maxed out, she says, “No, absolutely not. More restaurants will just weed out the sh**ty ones. The great restaurants are always packed when I go. We’re evolving. … The best will survive, hopefully, and we’ll soon become a culinary destination.”
Most owners of local food and drink establishments seem to echo Arthur and Fahy, saying the restaurant boom is a good way to separate the gems from the grit, and citing full tables as a benchmark for how the market is trending.
But in a city like Asheville, market saturation can be hard to gauge, notes Tom Tveidt of SYNEVA Economics. “Saturation is not an exact science, and the tourism market would make it hard to compare the number of Buncombe restaurants to the ‘average county,’” he explains.
Crunch a few numbers from the Asheville Area Chamber of Commerce, however, and you realize that there’s now about one restaurant for every 122 people in the 28801 ZIP code. In an industry that ebbs and flows with the waves of tourists washing up in the mountains (or not), a slow week or month can take a major toll on a business and its staff — and God forbid we should see an entire slow season.
Which leads us to another complicating factor: By the time the problem starts showing symptoms like empty restaurant seats or meager reservation lists, the hitch in the giddyup will already be in full swing. But long before those things become evident, the first warning signs will come from within.
“It’s definitely started to have an effect on the ability of good places to staff themselves with good cooks,” says downtown line cook Katrin Dohse, who formerly worked at the James Beard-nominated Knife & Fork. “There are not enough cooks.”
A-B Tech’s culinary arts curriculum and the GO Kitchen Ready program are training more chefs, but that’s addressing only part of the problem, notes Dohse. “Asheville no longer has the affordable housing necessary to house cooks, and restaurants rarely have the means to pay employees an Asheville living wage,” she points out. “On top of that, the parking and public transportation infrastructure in town seem to be built around tourism and not downtown employees, so add that fee on to those already just scraping by.”
Judging by my informal inquiries, most line cooks in Asheville seem to start out earning about $10 an hour, with the average rate somewhere around $12 to $13. That doesn’t go far in an area where the median monthly rent is about $1,044, according to a report by the consulting firm Bowen National Research. Statistics from the Chamber of Commerce show that Asheville’s hospitality industry employed 26,760 people last year, up 0.8 percent from 2015. That’s a significant chunk of the city’s population (88,512, according to the chamber), and there’s still a demand for more workers. But a burst of the hospitality bubble, due either to oversaturation or a dip back into recession, would hit those folks hard. Even one slow month can be devastating to someone who’s relying on tips, particularly when the local customer base is already spread so thin.
“Why do I think we’ve already reached oversaturation?” continues Dohse. “Because I see the best restaurants in Asheville advertising for cooks every summer. And, call me old-fashioned, but I feel like there should be so many aspiring chefs banging on the back door of these restaurants asking for a job that staffing is never an issue.”
And on this point at least, Fahy agrees. “I think if we’ve noticed any real oversaturation, it would be the labor pool in Asheville,” she says. “On one level, it’s a good problem to have: It drives employers to really examine their pay rates and benefits and try to be the best employers they can be. But it’s harder to find employees, and a lot harder to keep employees, than it was three years ago.”
One of the biggest challenges in retaining talented staff, she observes, has been the flood of new openings, which encourages workers to keep moving on to the next big thing after only a few months on the job.
Bartender Scott Dagenhart sounds a similar complaint. After working at Nightbell, the Corner Kitchen and Chestnut, he headed for Chicago’s greener pastures before winding up back in his hometown, New Orleans. In both Asheville and New Orleans, says Dagenhart, “The real problem I ran into is staffing. There’s also a dearth of bottom-level kitchen talent in Asheville: plenty of good chefs, but not anyone who wants to do the grunt work.”
The Big Easy, though, has the population to sustain its industry better than Asheville can: Even in a seasonal lull, there will still be enough full tables to make it through the heat of summer.
On the fringe
Meanwhile, Asheville’s dining scene isn’t limited to downtown. “There’s close to 700 to 800 restaurants in the Asheville/Buncombe area,” says Shastri, who’s been tracking the numbers for decades. “The way I always look at this is that you want to be in a scenario where, worst case, there’s at least 1.75 to two people per seat.” And most Asheville residents, he points out, don’t live in the city center. “So you might have that draw, but it’s not there all the time: They have places to eat near their own neighborhoods too. So it’s a question of getting those people to come downtown.”
The trend, however, seems to be going the other way. In East Asheville, for example, you have the East Village Grille, Filo and the Post 70 Indulgence Bar. Zambra’s Adam Bannasch opened the Copper Crown there in October 2015, and Post 70 just opened another branch, Post 25, in South Asheville.
Even Bouchon, a downtown fixture, plans to open an east-end operation targeting locals rather than tourists. “The purpose of the second location is to keep our locals: I don’t want to lose the people who allow us to be where we are today,” says Michel Baudouin, who owns Bouchon and Crêperie Bouchon and also founded the short-lived Lafayette. “For me, when I opened downtown 11 years ago, our clientele were the locals. Asheville was not what it is today. But now a large number of locals are staying away from downtown because it has gotten to be too busy. Parking is also an issue. If it takes you 10 to 20 minutes to find a parking space and then you come to the door and we ask you to wait an hour for a table … when you’re on vacation, that can be one thing, but when it’s a school day, you’re not going to be able to do it. Our new location will have 47 parking spaces, and it’s really directed toward the locals. I’m not even going to put up a sign.”
Asked if he’s concerned that drawing all the locals to his east side location will take business away from his downtown restaurants, Baudouin replies, “I’ve given it a lot of thought. If we didn’t have 2,000 hotel rooms opening within the next year or two, I would be a little bit worried about it. But Bouchon is only 50 or 60 seats. So even if we lose a little bit of business, if our wait time goes down from an hour and a half to 30 minutes, we’re not going to lose anything.”
A fluctuating game
The shift to the outskirts might help those downtown restaurants that choose to open outlying branches. But if easy parking and shorter wait times lure more locals to those outposts, it will only further dilute the pool of potential patrons in the city center, leaving other downtown eateries high and dry. Almost like a saturation through sprawl, or as Tolkien put it, “stretched, like butter scraped over too much bread.”
“I am absolutely the biggest cheerleader for the city of Asheville,” says Shastri, who still maintains a home here even though he now spends most of his time traveling for work. “I’ve seen it go from one extreme to where it is now. But when you really do your homework, Asheville is a really hard place to make money in an industry that’s already incredibly difficult to make money in. When you couple low margin with saturation … low margin and low volume is a definition of a dangerous investment.
“I think Asheville is in another transitional period, and it’s just going to be precarious for a while. I truly believe that once things start to stabilize, Asheville will have to lose 15 to 20 percent of the restaurants — above what normally closes and opens — to have any stability,” he continues. “The good people will always do well, and the bad people will always go out of business, but unfortunately, the people on top still suffer. It’s always a fluctuating game, and it just fluctuates too much when there are too many choices.”