After nearly 30 years, restaurateur Danny Meyer will relocate his acclaimed New York City restaurant Union Square Cafe. According to the New York Times, Meyer is facing a rent hike and was unable to come to terms with the building's owners over what the restaurant space was worth. The lease expires at the end of 2015.
Meyer also reveals details as to why his extremely successful restaurant empire (which includes the ever-expanding Shake Shack) cannot absorb the cost of a rent hike. "Each of the group's restaurants is a separate company ... revenue from Shake Shack cannot be repurposed to pay for ingredients or salaries at Union Square Cafe" he explains to the Times. Meyer also adds that sinking more money into the space is not a savvy financial decision, citing "antiquated" utilities and limited room for expansion.
Meyer is just one of many New York City restaurateurs dealing with staggering rent increases. Marco Canora at Hearth is remaining in his space in spite of a 65% increase, while Wylie Dufresne is closing (and possibly relocating wd~50 because the building is being redeveloped. Beloved hot dog vendor Gray's Papaya shuttered their second remaining NYC location after a $20,000 rent hike, only to be replaced by a fancy juice chain.