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The rise of fresh-casual


Restaurant retail is in the midst of a revolution.

According to the Urban Land Institute, one of the key factors driving traffic at retail is the rise of new food concepts, which account for nearly 50% of shopping center growth nationally. The first volleys of this revolution were fired by a spate of new fast-casual concepts, but as the movement gains momentum, it is evolving from fast-casual to fresh-casual.

Fresh-casual chains focus on chef-driven food options, an elevated service experience for customers, high-quality design and décor, and fresh, locally sourced ingredients. These establishments differ from fresh casual in several ways.

• Fast-casual concepts retain a link to the quick-service model. The dining experience begins and ends at the counter, where customers order and pick up their food.

• Fresh-casual eateries, meanwhile, are more service-oriented. While fast-casual restaurants deliver higher-quality food than traditional QSRs, they don’t compare to fresh-casuals that prioritize fresh and even organic ingredients.

• A fast-casual restaurant will typically feature generic displays and promotional materials. A fresh-casual environment will showcase custom artwork and unique fixtures.

Millennials are the primary drivers of the fresh-casual trend. Compared to baby boomers, the younger generation places a higher value on fresh ingredients, customizable food, and aesthetics. Plus, they just eat out more. A survey by Morgan Stanley Research found that 53% of millennials eat out at least once a week, compared with 43% of the rest of the population. Because millennials tend to throng to urban areas, cities serve as the hot-beds for fresh-casual concepts.

For example, we own an office building in downtown Los Angeles that features retail space on the ground floor. We assessed tenants’ food preferences when considering what restaurants to place there and found a lot of millennials who preferred fresh-casual over fast-casual food options. As a result, we elected to incorporate a poke eatery into the retail space. Poke (pronounced po-KAY), a Hawaiian raw fish salad, is a prime example of a fresh-casual concept gaining rapid acceptance among consumers. It’s essentially sushi in an easy-to-eat format that is also easily customizable.

Fresh-casual restaurants are well-aligned with consumer demand for experiential dining experiences. People are searching for unique food options and authentic dining experiences wherever they go. And that most especially includes shopping centers.

Tim Lee is VP of corporate development at Olive Hill Group, a privately owned operator and developer of commercial real estate properties. He can be reached at [email protected].

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