Dubai: Think Dubai has too many restaurants? Then you haven’t checked out the dining scene in New York.
“From my perch in New York, we have approximately 35,000 restaurants in an extremely competitive environment,” said Ahmass Fakahany, CEO of the Altamarea Group, which operates a portfolio of fine dining concepts in prime cities.
“The consumer will decide if there are too many players or not as demand and supply aligns in UAE. The consumer voice is becoming more powerful and relevant, creating a higher standard with some expected shake-out. This all good for the consumer... and the quality standard.”
Fakahany’s sentiments do seem at odds with the shrill warnings that many in the local F&B scene have been sounding of late. They point to the number of closures the sector had seen all through last year. And for those still remaining, the margin squeeze has been particularly severe.
But Fakahany insists that not much should be read into this.
“Margins are under stress everywhere and should be here [in Dubai] too as the market evolves. Margins are under stress in New York, London and in all densely populated competitive markets.
“Business models need to be reassessed. The efficiency operator who is keeping a close eye and ear on consumer feedback will have a comparative advantage. Opening a restaurant and expecting to make money based on the growth curve is ignoring the complexity and evolution of the market.”
Fakahany sure has the credentials to take a wide-angle perspective. He was formerly president and chief operating officer at Merrill Lynch before a taste for the business of food got him to launch the Altamarea Group. Its subsidiary — Atelier House Hospitality — has an office in Dubai.
On the happening markets for new F&B specific investments, he said: “New York is key, but you need to know ahead that barriers to entry are high and why you need to partner with Atelier House Hospitality to bring in your brands thoughtfully and smoothly. London is also a dense, affluent market, but needs more of a shake-out on property rates in key locations. I would add Dubai too — Dubai is also a dense market with a range of consumers who are evolved foodies.
“Overall, large dense markets with also affluent clients are still very relevant, but you enter now with a view you that you have to compete. You have to be differentiated in venue and quality, and you have to be efficient.”
So, in 2018, where is Fakahany likely to place his money — in fast, casual or fine dining?
“I believe in diversification, but based on a disciplined operator with a strong finance, operations and marketing team that is closely watching and evolving with consumer needs and the technology revolution in F&B around convenience and choice. I have a strong operation in New York with the Altamarea Group and opened Atelier House Hospitality in Dubai because I believe in this market.
“We plan to open our flagship — the Michelin acclaimed Marea restaurant — in DIFC, but will also look at different brands and price points in this market. There is room for both and the consumer needs different venues around different occasions and moods. We look forward to the competition and fighting for our space.”
