The good, the bad, and the utterly brutal side of hospitality

Saturday, 11 November 2023

Pow. Wham. Wallop. The angular screaming pink lettering hits you between the eyes. The typeface might be reminiscent of Kiss’ signature font, but this is no hard rock album cover.

This is the website of Plonk, one of Wellington’s newest, casual dining outfits. It’s a far cry from its former self when it was known as Atlas.

Atlas opened in August 2019 with — as executive chef James Pask said at the time — a vision to create a casual, fun environment with a high-end offering of modern New Zealand food. Its degustation menu (food only) started at $125.

But that was then, before Covid and a cost of living crisis. This is now. The Yu Group closed Atlas in July, just short of its four-year anniversary.

Award-winning Shepherd and the much-loved Field & Green followed more recently. The owners of both cited the unprecedented economic environment, including dramatically escalating costs across wages, ingredients, rent, and the challenges that has wrought on the sector, as well as its customers.

“People just aren’t coming into town in the evening,” Field & Green’s Raechal Ferguson says. “There’s lots of reasons for it, but it is happening less and less.”

On Monday the owners of Petone’s Flint Social joined the exodus, just eight months after launching. Flint’s last day is Sunday.

Asher Boote, who ranks up there with New Zealand’s most innovative operators, and whose Hillside Kitchen, opposite Premier House in Thorndon, has a stack of awards, has also been considering pulling the pin.

Hospitality was brutal, he said in an emotional online post this week, referencing the closures — and an ongoing struggle with his mental health. “I don’t think people quite realise the burden that’s being carried. I would be lying if I said I haven’t considered walking away from it all.”

Discretionary spending had taken a hit, and with it, an unabated willingness by many to splurge on a night out.

Boote encouraged those who could afford it to support their favourite restaurants — or lose them.

“What is so scary is that high quality restaurants are struggling. The old adage of cream rising to the top isn’t so much the case, there’s more of a race to the bottom.”

Still some places were, if not exactly flourishing, then doing okay. They tended to be more casual, the food more basic and affordable.

There are outliers, of course. Hiakai, the globally acclaimed Mt Cook restaurant run by Monique Fiso is taking reservations for its new three-course kai experience at $225 per person through to January.

And there’s Logan Brown, still doing its deliberately high-end thing in the heart of Cuba St, alongside Liberty, a satellite venue doing made-for-sharing food in the former beer and burger joint Grill Meats Beer.

However Steve Logan, who helms both Liberty and Logan Brown, as well as Parliament’s Bellamys by Logan Brown, says they too had to simplify their their operation, through the Covid era.

“We are recovering well, but like most of our colleagues this year has been a tough one. The cost of running the business is still very high and out of proportion to revenue.”

Despite increased costs for food, beverage, wages and compliance, many in the industry were reluctant to up their menu prices given the competition, he says.

“With the cost of living crisis we have people dining out less often, spending less per person and choosing more simple restaurants. These days a much larger proportion of diners go for more humble ingredients and basic cookery and service.”

Logan says restaurants such as Shepherd and Field & Green would be missed. “They are in it for their care, craft and passion. They are also restaurants that develop young professionals and promote small producers, so a loss for Wellington’s restaurant community and visitors.“

Meanwhile Plonk’s Pask believes fine dining has, for now at least, done its dash. Changing habits post Covid had forced Yu Group to turn its back on its seasonal high-end menus, and pare back its offerings to better align with customer demands.

“Atlas was a destination, people went there for a dining experience. We were finding that our regulars, who used to come once every season or every six months, would only come in once a year, and often only for special occasions.”

The lack of overseas visitors during Covid, and since, had been fatal, Pask says. That, and fewer people in town during the week.

“Fifty percent of our business was tourism. Through Covid, that was problematic. We did have some local uptake, but over the last six months it has been really hard to get early week diners.”

Atlas switched to an a la carte menu. Per head spend plummeted. “Basically it got to the point where I realised this model doesn’t function at the moment, we needed to do a more low cost offering.

“People aren’t willing to outlay $150 just on a menu, they want more flexibility,” Pask says.

Pivot. Plonk. Touted as a cheerful, irreverent “bistrotheque”, Plonk serves casual, snacky and small plates and features live music.

Pask has his fingers crossed, at the same time noting people had modified the times they came into the city.

“The whole Monday to Friday model, where [numbers] go up like a mountain steadily during the week has changed. In our CBD venues now it starts of slowly, peaks on Wednesday and then slips off, the only exception being Friday which is the same as it used to be. People still go out on a Friday night.”

Interestingly, or should that be audaciously, Pask had just been at the opening of another Yu Group venue, a pizzeria in the Bowen precinct alongside Parliament grounds. It plans to open anther venue in the same vicinity in March or April next year. Sorella will be sister to Astoria, the scene of the infamous coffee meeting between Labour MP Clare Curran and RNZ’s Carol Hirschfeld.

The group also owns Cinderella in Willis St (previously the Bresolin), Choice Bros in Ghuznee St, Corso Pasteria (Willis Lane), The Hudson (Chews Lane) and several Mian noodle outlets.

On a somewhat less grand scale Victoria McDowall and Harry McArthur are also making their mark on the capital, having taken a leap of faith in 2021 — mid-pandemic — to open a sandwich bar on Cuba St.

Their new venture is The Ram. It’s also in Cuba St, in the building that previously housed Plum Cafe and latterly Le Café Plum, a cocktail bar which opened in 2020, only to close its doors in January this year.

McDowall doesn’t believe Wellington is dying, just that pockets aren’t as deep as they once were.

She saw hospitality headed towards the more casual and relaxed style of dining.

“We believe in this city and the community within it and our decision to open The Ram reflects that belief.

“There are a bunch of great things opening… this city has a lot of life in it yet..

She believed local government had a responsibility to cap commercial lease increases “which is what’s really killing all of these small businesses”.

Cuba St is also home to Fidel’s cafe, a Wellington institution which has featured on any number of “best of” capital city lists for 27 years.

It stopped opening at night when Covid hit, and hasn’t been open in the evening since.

Says owner Roger Young: “It’s not worth it. It still feels like we’re in lockdown. Some mornings when I come in at 9 or 10, there is no one around, there are no cars, and it’s dead after 3pm.”

In all the years he’s been in the hospo business Young says he has never seen it so bad. This month’s closures were a worrying sign, the tip perhaps of the iceberg. He expected there would be more – and sooner rather than later.

“We are all struggling, most of us are just hanging on for dear life. It’s a perfect storm really with the cost of living and interest rates so high, and then there’s people working from home two or three days a week.”

Like Pask, Young is hoping business will pick up over summer. He has plans to open the cafe on Thursday through to Saturday nights from December 1, but that hinges on whether or not the punters play ball. “We’re still gauging it.”

Across town Kat Strand and Johnon MacDonald are feeling considerably more up-beat. The former Australian-based pair is the team behind the one month old Mt Vic restaurant & wine bar Rosella, literally a hop and skip away from its sister venue, Koji, an Asian-inspired restaurant also on Majoribanks St.

While they are certainly aware of the challenges the hospo community is facing, MacDonald says they are optimistic about the future.

And that buoyancy is reflected in the name of their company, Good Vibes Hospitality. “Our venues are set up around exactly that, creating a good vibe. Our biggest focus is on our staff, and making sure that they are having a great time and they're loving their jobs. We find that if this happens, then that creates the vibe of the venue.”

Both have previously worked in fine dining. “We are hospo people through and through,” MacDonald says. “We live and breathe it.”

Dragonfly in Courtenay Place was homeless for four months after the 2016 Kaikoura earthquake. Owner Brent Wong says a pop up venture in the St James was good practice for the roller coaster hospitality had been on since Covid hit.

He has definitely noticed some belt-tightening as the cost of living bites but believes trends in dining out have always been cyclical.

“Wellington doesn’t have the population to sustain too many top end restaurants, and I think perhaps we’ve had too many. Some of those are now realising the market has shifted and are looking to re-invent themselves.”

The latest Consumer spending data from payment network Worldline is a clear indication of how spending patterns are changing, with a notable slowdown across all of October in spending amongst cafes and restaurants. In contrast, spending continues to increase across supermarkets and fast foods.

And on Wednesday the Restaurant Association leapt into the fray, saying it was becoming increasingly aware of the many businesses struggling to stay afloat.

In what could only be described as a call to arms, it said a recent survey had shown decreased patronage was the main challenge facing 35% of respondents, while 30% felt that conditions would get worse over the next 12 months.

After decades of being immersed in everything hospitality, long-time food writer and chef David Burton really has seen it all before.

Yes, Atlas’ closure is “another nail in the coffin” for the city’s hospo scene, he says, but it was not just a recent phenomenon.

In fact Burton suggests the difficulties stretch back to the 80s: “It was really after the stock market crash… when you saw the end of those long business lunches where [people] were spending money they never had on $1000 bottles of champagne.”

Cafes, where quick, easy food provided newly cash-straitened lunchers a cheaper alternative, took off. “That’s still with us now, and that is only going to continue.”

Still Burton would hate to see high-end dining disappear completely. He heaps praise on Boote’s Hillside Kitchen, suggesting it is the most perfect model of the style, and concedes that if ever Hippopotamus (the swanky restaurant in the QT Hotel) and Logan Brown were to close, it would be the extinction of that particular genre.

“It would be a real loss to our culture.”

How you can help:

Understand how much of a difference you can make by eating out, if you can afford it, Asher Boote, owner of Hillside says. 'I cannot stress enough how much your business means at the moment, we know so many people are struggling financially so making the choice of where to dine out (if you can afford it all all) makes a huge difference to the people involved in the business.'

Support your favourite establishments however you are able. “This support isn't just about a meal or a night out; it's about contributing to the very survival of these businesses and preserving their place in our communities,” Restaurant Association chief executive Marisa Bidois says.

Logan Brown’s Steve Logan says the overseas dollar helps too. 'We hope we get plenty of international tourists to Wellington this summer, who will be very happy with their exchange rate and no doubt appreciate how inexpensive our quality restaurants are compared to where they come from.