Explaining Detroit's empty restaurant spaces

The empty restaurant storefronts dotting the city are a sign that the pandemic's impact on the hospitality industry persists.

Why it matters: Stakeholders attribute empty storefronts to factors like restaurant staffing challenges, persistently high equipment and construction costs and difficulties accessing capital.

• COVID-19 hampered the trajectory of economic development across the city, James Van Dyke, developer Roxbury Group's executive vice president, tells Axios.

Context: "It's a crazy transitioning time in Detroit for restaurants right now," Brian Whitfield, a VP with real estate firm Colliers who specializes in restaurants, tells Axios.

• Opening one takes "a lot of energy, a lot of cash, and the office market is the elephant in the room." Nightlife traffic is back but lunch traffic from workers is less so.

Zoom in: The Parker Durand development in West Village, co-led by Roxbury, is pivoting to retail after a spot it targeted for a restaurant has sat empty since the 92-apartment mixed-use building opened in early 2022, Van Dyke says.

Details: The $22 million development that was delayed by the pandemic leased two of its three ground-floor commercial spaces to a clothing store and a fitness studio.

• Because it can't get a restaurant to fill the 3,200-square-foot third space, Roxbury recently decided to split it in two and offer the storefronts to smaller retailers.
• Roxbury partner Invest Detroit also is paying $250,000 to build out those smaller spaces for future tenants, per Van Dyke.

What they're saying: Van Dyke says Roxbury expected the space to lease quickly "given the growing demand for retail and restaurants in West Village … but then the pandemic hit."

• And restaurateurs can save by choosing already outfitted spaces where another restaurant has closed, instead of building out an expensive blank slate like at the Parker Durand, he adds.

Of note: Other long-empty, restaurant-targeted spots include the former Sala Thai in Eastern Market, the closed Bangkok Crossing downtown on Woodward and the former Le Culture Cafe.

The other side: Examples of restaurants that have recently opened include Table No. 2, which closed on the Livernois Avenue of Fashion and reopened in Greektown, Vigilante Kitchen in the former Smith & Co. space and Detroit Soul's second location in Jefferson Chalmers.