Ah, bistro! The men behind the London-based Côte chain of bistros are in the lucky position where long leasehold agreements are just fine, writes David Harris.
If you want to open restaurants in a credit crunch, it helps to have someone rich behind you. For Côte, a newly established group of mid-market French-style bistros, a large chunk of that wealthy support comes from multi-millionaire Richard Caring, who is the majority shareholder.
But while Caring might be the reason why banks don’t mind lending to the Côte group, the day-to-day running of the company is handled by four stake-holding directors – Andy Bassadone, Chris Benians, Marcus Cload and Nick Fiddler.
All have considerable experience of running profitable restaurants including, in no particular order, J Sheekey, The Ivy, Daphne’s (allegedly Princess Diana’s favourite eating-place), Pasha and mid-market chain Strada.
The sales of their previous ventures have made them all well-off, even without Caring’s heavyweight backing, so the motivation for setting up Côte, which opened the first of four units early last year, is certainly not to turn a quick profit.
Two of the director quartet – Benians and Cload – are chefs, while all are passionate about food, so catering is a business they care about in more than purely financial terms.
And for restaurants, property matters. Sites are crucial. There is a lot of received wisdom concerning the best place to put a restaurant Neville Abraham, co-founder of another French-style restaurant group, Chez Gerard, once said that the best place to put a restaurant is next to another restaurant.
Bassadone agrees that this approach has merit, but adds qualifications. He says: “It’s true, up to a point, but London is a hard place [in which] to identify the good sites. It’s not just a matter of area, it’s a street-by-street process.
“A good spot can be round the corner from a bad spot. And as far as being next to other restaurants is concerned, it depends which ones. We wouldn’t want to be next to Nando’s, for example.”
Like most other restaurateurs, the Côte team fiercely avoids clusters of pubs, the so-called “vertical drinking” areas (in the sense that they are designed for large numbers of people drinking standing up). They are, says Bassadone, more likely to repel restaurateurs than attract them.
So where in London has Côte opened so far? The four outlets already trading are in Wimbledon, Richmond, Covent Garden and Wardour Street, Soho. Another will open in November at Kensington Court, just off Kensington High Street. Côte hopes to add another five next year.
Of course, a group with a restaurant in Soho’s Wardour Street is bound to be near other restaurants, but in south London it is just as close to fashion shops such as Joseph and Max Mara. Clearly, this is ladies-who-lunch territory.
Leasehold
All the sites are leasehold, because the group would rather use its capital to expand than invest in property, and Bassadone and Benians confirm that raising money from the bank has not been a problem, thanks to Caring’s support.
Money has also been important in fitting out the restaurants. A typical fit-out cost for a Côte outlet is £600,000, the sort of figure that makes the group keen to take long leaseholds of 15 or 20 years to justify the investment – and, in Bassadone’s words, “never give them a chance to terminate the lease”.
Each restaurant seats between 90 and 120 and runs to 3,000-5,000 sq ft, a size with which the directors feel comfortable.
Benians says: “It’s better to run a 120-seat restaurant well than a 150-seater not quite well enough.”
For the moment, the group plans to open only in London and the south of England, partly because the directors want to be close enough to their restaurants to monitor them personally.
Small things
Côte’s business plan after a £600,000 fit-out involves making its money back within three years of trading. However, sitting with Bassadone and Benians during a busy lunchtime in the Wardour Street branch, it becomes clear that their main concerns are less about takings than about how the restaurant is operating.
Small things are important. Are all the lightbulbs working? Are the glasses polished? When diners arrive, are they seated promptly? Of course, this all adds up to profit in the end but, for them, running a good restaurant seems like an end in itself as well as a means of making money.
Most striking of all, Bassadone and Benians are extremely proud of their menu. The dressing on the tomato salad, they point out, is not just red wine vinegar, but cabernet sauvignon wine vinegar.
The meat is sourced with care – chicken from Les Landes and beef for the steak frites from Scotland. Espresso is served in small glass tumblers, not just because this is French bistro style, but because it displays more clearly the density and quality of the coffee.
The directors will also draw attention to the fact that their pudding menu offers both crème brûlée and the less fashionable crème caramel, and they are keen to stress the difference in ingredients and methods which makes these superficially similar dishes so different. The food matters to them in a way that you cannot attribute to every restaurateur.
In décor as well, Côte has made a big effort to give diners what the directors see as a genuine French-style experience, rather than what they see as inauthentic French imitation as practised by some of their mid-market rivals.
So far, the restaurant critics who have visited Côte have been largely friendly, although Bassadone and Benians were less than happy with the review by the London Evening Standard’s Faye Maschler, who went to the Wimbledon branch.
She liked the surroundings and service but was not so flattering about the quality and authenticity of the food.
Set against Maschler’s review, however, are pleasant write-ups from the Good Food Guide, Nicholas Lander in the Financial Times and London listings magazine Time Out.
Good business
What is more important than the plaudits (or otherwise) of the critics is that all the restaurants are doing good business. Certainly, there is nothing to suggest that the steady expansion plans of Côte should be inhibited, either by reviews or by a less than buoyant economy. But Bassadone says that it seems unlikely that pressures on the commercial property market mean that Côte is going to get a much better deal on its leaseholds than it would have done before the credit crunch.
He says: “Getting the very best sites is important to us and, to be honest, I don’t think their price has fallen very much, if at all.”
Influenced
Côte’s attitude to its sites, in line with its general approach, seems to be influenced by the fact that none of the directors needs to turn around investments particularly quickly. Bassadone says: “Because we have already made some money, it is not so important to us to sell on as it might otherwise be.”
Launching a restaurant in the current market is a brave thing to do. Even so, few would bet against Côte being one of those to succeed in lean times, because of both the money behind it and the experience of its management team.
The mid-market aim of good food at reasonable prices might be just the ticket for London’s cash-strapped right now. And property agents need every successful expanding business they can get.
Who runs Côte?
The majority shareholding in Côte is held by Richard Caring. The other four directors – Andy Bassadone, Chris Benians, Nick Fiddler and Marcus Cload – hold the remaining shares.
The directors’ CVs are similar. Bassadone and Fiddler were, respectively, chief executive and financial director of Signature Restaurants from 1998 to 2005. This group included Strada, Belgo, Caprice Holdings, Daphne’s, Bambou and Pasha.
Benians was executive chef of Signature Restaurants when it was acquired in 1998, and Cload was head chef of Pasha before they both transferred in 1999 to work on the creation of Strada.
Ultimately, all these business were sold to Caring in two tranches – Caprice Holdings in June 2005, then Strada and Belgo in September of the same year. The four directors stayed with Strada until May 2007, when it was sold to Tragus and Blackstone.
Richard Caring
Richard Caring, the majority shareholder in Côte, has worked with all four of the working directors for several years. His personal wealth, put at £450m by the Sunday Times Rich List, derives mainly from his partnership with retail mogul and Arcadia owner Sir Philip Green.
Having made his money in the clothing industry, Caring has chosen to spend it on the restaurant and entertainment businesses. He has bought a series of trophy assets, including Wentworth Golf Club and nightclub Annabel’s, and restaurants such as The Ivy, J Sheekey and Scotts.
