Intown Atlanta’s food scene has been flooded with new openings in recent years with projects such as Ponce City Market, Krog Street Market and The Shops Buckhead Atlanta bringing dozens of new restaurants to the city.
The growth has been rapid. Atlanta has added approximately 350 new restaurant spaces since 2008, according to data from the Georgia Restaurant Association.
Today, there are an estimated 3,332 restaurants in the city limits, up nearly 12 percent from 2,980 restaurants in 2008. But could Atlanta be getting bloated from all the tasty new choices?
As e-commerce sales continue to take a bite out of retail, restaurants have become the go-to anchors for many mixed-use developers. And there are plenty more in the pipeline with the planned redevelopment of Colony Square, Peachtree Center, Underground Atlanta and Atlanta Civic Center.
“Today, there is an insane amount of competition for food dollars intown,” said George Banks, who just launched Revel, a new retail consulting and development firm, with partner Kristi Rooks. Banks formerly worked for Paces Properties, the developer behind Krog Street Market. “You could see a lot of restaurant fallout in the next five years.”
Karen Bremer, executive director of the Georgia Restaurant Association, called the recent influx of intown restaurants “significant” and shared some concern there may not yet be the “population density that’s required to afford that many restaurants to be busy.” She remains optimistic it will balance out.
Atlanta chef Jay Swift on July 24 shuttered his popular fine-dining restaurant 4th & Swift in Old Fourth Ward. Swift had been an early pioneer of the area, opening the restaurant in 2008 at the start of the recession. He quickly grew a faithful following.
But, fast-forward to today, and dozens of new restaurants have flocked to Old Fourth Ward and nearby Inman Park, including those at Ponce City Market, Krog Street Market and Inman Quarter, which combined brought nearly 50 new dining choices near 4th & Swift.
Swift said while he’s grateful for the eight-year run, he decided to close 4th & Swift and focus on his new venture, Noble Fin in Peachtree Corners. There, Swift said, he sees a growing community with untapped demand for quality restaurants.
Other established Atlanta restaurants have seen slow sales growth in recent months, according to data fromNetFinancials, a local CPA firm that each quarter surveys around 100 independent restaurants in metro Atlanta.
From 2010 to 2014, NetFinancials saw restaurant sales grow an average of more than 5 percent each year.
But in 2015, restaurant sales only grew 2 percent, with the last three quarters nearly flat-lining. NetFinancials cited the flurry of new restaurant openings as creating “strong headwinds” for existing restaurant operators.
This year is showing some positive signs, with first-quarter restaurant sales increasing 3.5 percent. Bob Wagner, president of NetFinancials, estimates second-quarter sales to increase 2.2 percent.
Some retail experts remain optimistic intown Atlanta can continue to absorb the new openings, especially as dozens of new apartment projects in Midtown and Buckhead fill with residents.
“All those bodies are moving into Atlanta — it’s quality of life over commute,” said Gene Rice of Vantage Realty Partners, which works with many of Atlanta’s top chefs, including Ford Fry. “It’s a really dynamic market right now and there’s a lot of movement. It will be interesting to see how it shakes out.”
Amy Wenk covers hospitality, retail and restaurants.