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Summer, 2023: A New Look
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Expanding Restaurants Face Tall Orders

June 22, 2023
Establishing Your Business, Commercial & Investment Real Estate, Retail Properties
Big plans hit supply, delay and cost snags.
Modern building under construction

© Dan Reynolds Photography / Moment / Getty Images

Restaurant trends are in flux in 2023. Ghost kitchens—hot in 2021—are facing slowing delivery demand, higher capital costs, and quality control issues, restaurant tech exec Rishi Nigam told digital publication Restaurant Dive in January. Nigam is CEO of Franklin Junction, a restaurant ecommerce platform. Meanwhile, supply chain shortages remain an unwelcome trend, bringing continued construction delays and cost hikes—especially challenging or restaurant operators that are expanding or renovating.

70%
Percentage of diners who say it’s important for their food to come from a publicly accessible, physical location, according to the National Restaurant Association’s 2023 State of the Industry Report.

Take Titan Hospitality. Supply shortfalls have affected its development plans for two new restaurants, Titan CEO James King told Restaurant Dive. It’s taking 16 weeks to get materials and 30 weeks to get a walkin freezer box. Plus, the lack of electricians and plumbers has pushed the construction timeline beyond the typical three weeks. All that has added up to a 30% increase in costs, King said.

Bad Ass Coffee of Hawaii recently opened its 28th location and is constructing 12 more units, according to FSR magazine. The coffee company’s CEO, Scott Snyder, said Bad Ass is starting to see a “bit of a reprieve” on construction costs and delays, wrote FSR author Danny Klein. But some of its stores have faced permitting delays lasting for months, when the process used to take three or four weeks.

Adapted from “5 Trends That Will Shape the Restaurant Industry in 2023,” published by Restaurant Dive, Jan. 5, 2023, and “The State of Restaurants in 2023,” published by FSR magazine, Jan. 11, 2023.

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