Tuesday, July 06, 2021

What Is the Restaurant Renaissance, and How Will It Impact Investors?


Apr 13, 2021 by Liz Brumer


The restaurant industry was rocked by COVID-19, with thousands of restaurants across the country still weathering the storm over a year later. But as the coronavirus vaccine becomes widely distributed and states start to loosen restrictions, a restaurant renaissance is set to begin.

The term "renaissance" refers to a period of resurgence. The restaurant renaissance, as it's sometimes referred to, is the revival of restaurants after the massive shutdowns the nation has faced.

Of top concern for diners is health and cleanliness standards. A recent Zagat survey found that 1 in 3 people surveyed will eat out within the first week of restaurants reopening, but outdoor seating is the No. 1 most important factor to them. Also important were social distancing being respected between tables.

Restaurants with access to large outdoor spaces will be able to best adapt to fit these needs, but other restaurant tenants will likely need to seek new spaces or modify their current space to accommodate for new design trends.

A renaissance is good news for real estate investors, particularly those who invest and/or have interest in retail or other commercial real estate through a related real estate investment trust (REIT).

Keeping an eye on which retail REITs are still offering value in their share price with room to recover during this renaissance period is the best way to capitalize on the opportunity. It may also be worthwhile to invest in retail space that offers what diners are looking for: larger spaces with outdoor seating and ease of to-go or delivery options.