September 12, 2016

Worcester developer, restauranteur forge unlikely pact

Frank Peace, CEO of New England Craft Restaurant Concepts, is planning for a quick expansion of most of the restaurants featured in the development.

Developers securing restaurants for their buildouts typically face two choices: go with a chain that is more of the same but can pay top dollar for the location, or take a chance – and likely a financial hit – to bring in a desirable chef or a concept that could potentially create a unique draw for your location.

The Grid District in downtown Worcester could turn that thinking on its head.

The company behind the 6.2-acre development with more than 500 apartment units directly off the Worcester Commons has partnered with New England Craft Restaurant Concepts to handle five different restaurants and one coffee shop.

The restaurant group plans to use these Worcester locations to launch these new brands throughout New England and – for a few of the concepts – nationwide.

The goal from the perspective of the developer – MG2, based in Quincy – was to streamline its dealings while bringing in a qualified partner who would build up the cache of the overall development.

"There's a synergy, and there's a shared vision between our groups for what the retail space should and could be out there," said Joseph Donovan, vice president of MG2. "They fit perfectly with our vision of The Grid District and how we want to brand it, and what we want the resident and folks who work in the neighborhood to experience when they think of The Grid District."

That impact can already be seen with Brew on the Grid, the first of the eateries that came online this summer facing the Worcester Commons. The coffee shop is busy and drawing customers into the area from surrounding businesses during the week and attracting shoppers and residents looking for a caffeine kick on the weekend, Donovan said, and it is this kind of energy that the developers want for their mixed-use development.

"A critical element ... is having an active street-front presence. We want people to think of the Grid District as live, work, play, visit," he said.

That energy is only set to build, with five restaurants launching within the next two months. All told, by the end of the buildout there will be 550 new dining seats within the city from that single development. Among them will be an outdoor beer garden, a Mediterranean restaurant and a pizza and beer shop.

If done right, these locations will all pull in slightly different clientele, or those who will bounce between the different restaurants and create a whole-greater-than-the-sum-of-its parts location for dining in the city, Donovan said.

From one restaurant to six

At least that is the plan according to Craft Restaurant's CEO Frank Peace, Jr. Although the company was originally discussing building one restaurant in the development, once talks began and the leaders of both companies realized the scope and the ambitions of each other, there was a realization of the potential a partnership could bring.

"Because of [MG2's] commitment with this development and the power that they have over developing properties gave me confidence … that I was part of the renaissance that is happening in this area," Peace said. "This is a great synergy … People aren't going to want to live here unless there are amenities."

For Craft Restaurant, a partnership with MG2 not only secured access to the growing market of Worcester, where competition for real estate can push out non-corporate offerings, but the efficiencies of having multiple restaurants located next to each other. This has not only allowed benefits such as the sharing of kitchens between two locations but also instantly created an avenue for employee growth within Worcester.

The 500 employees that will ultimately work at the restaurants will be able to move between the different locations and remain with the company while advancing their own careers, Peace said.

Starting point: Worcester

The partnership in Worcester sets up the restaurant group for growth beyond the city through its developing relationship with MG2. Craft Restaurant is looking for significant growth out of the Brew and Pie and Pint brands that are being started in Worcester.

Peace was brought on specifically by Tapp'd Restaurant Group in Rhode Island – from which New England Craft Restaurant Concepts spun off – to create this big growth.

For Peace and his organization, this partnership not only helps ground the restaurants in Worcester, but grow them quickly and efficiently with a known partner elsewhere. While some of the new eateries will be located outside of MG2's developments, the partnership is already bearing fruit with Brew on the Grid locations in Lynn and Salem being built as part of MG2 projects.

A novel concept

This close partnership between a developer and restaurant group is unique, said Massachusetts Restaurant Association CEO Bob Luz. Usually a developer will either partner with a chain and reap the financial benefits of a stronger rent and the buildout being handled for them, or take on the risk of working with an up-and-coming chef or restaurateur with an excellent concept but less of a financial certainty.

This decision is becoming increasingly important as developers look to restaurants to fill the void left by retail shops taking a hit from internet sales.

"Retail isn't doing it anymore," Luz said, but "you can't Internet your way out of the restaurant business."

If this new partnership concept is going to work, Worcester's is a good place to try it out, with Luz saying that next to Boston's Seaport, Worcester's market is the state's most desireable.

"I don't think there's any other city in Massachusetts that has a more vibrant and rapidly expanding hot scene than Worcester does," Luz said, adding Boston chefs are eying the area as a location to open up their own ventures. "It's an exciting scene right now that is hopefully going to continue to grow and get more exciting."

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