Can Chicago’s Food Halls Survive the Pandemic?

When Hayden Hall opened in February, it was simply the latest food hall in a city increasingly saturated with them. Every few months, some impeccably designed project opened promising a collection of top-notch chefs, from Time Out Market Chicago in the West Loop to Wells Street Market in the Loop. Some were even getting national attention. On Feb. 26, Margaret Pak’s Thattu in Politan Row was selected as a semifinalist for best new restaurant in the country by the James Beard Foundation.

With a few exceptions, the public’s insatiable appetite for food halls looked like it would never end. For developers, the format was an easy way to attract crowds to downtown projects. And for restaurateurs, whether aspiring or established, it was an affordable way to test new ideas.

But with all Illinois restaurant dining rooms closed due to the coronavirus pandemic, and the idea of stuffing hundreds of people together in one room sounding unsafe, will food halls be able to survive?

“I’ve never felt so ill prepared to answer such a big question,” says Bruce Finkelman, managing partner of 16″ on Center, which runs Revival Food Hall in the Loop. Finkelman says he’s been focusing on the immediate issues. “It’s heartbreaking the amount of people we had to furlough,” says Finkelman. “I’ve been worried about how we pay rent. Do we have a workforce when this whole thing is over? It’s really hard to look at the bigger picture right now.”

It doesn’t appear that food halls in Chicago will be able to open any time soon. According to Gov. J.B. Pritzker’s five-phase reopening plan, restaurants will be able to reopen their dining rooms with 50-person capacity limits in phase four. (Currently, we are in phase two.) But food halls, which depend on attracting large crowds, probably won’t be able to fully reopen until phase five. And as the governor’s plan details, phase five won’t happen until a vaccine or some other effective treatment is widely available. Dr. Anthony S. Fauci, the director of the National Institute of Allergy and Infectious Diseases, estimates it will take a year or more to develop a vaccine.

Will food halls be able to survive being closed that long? And will customers want to return to crowded spaces? Already, a few food halls in the works have pushed back their opening dates.

London-based Urbanspace, which has U.S. food halls in New York and suburban Washington, D.C., has pushed back its planned opening at 15 W. Washington St. in the Loop, which had been set for April. A larger, 14,000-square-foot food hall is expected to open in the city’s tallest skyscraper, Willis Tower, in August or September, Urbanspace president Eldon Scott says. “It’s really, really tough,” Scott says of the pandemic. “There’s no two ways about it.”

Dr. Murphy’s Food Hall in the old Cook County Hospital building, was expected to open in July or August, but according to Chicago developer John T. Murphy, that will now depend on when restrictions are lifted.

Revival Food Hall, which remains closed Monday, May 18, 2020, in the Loop in Chicago, has been an opportunity for small restaurants to get a start on the scene. (Erin Hooley / Chicago Tribune)

Finkelman believes there’s no way for food halls to reopen without input from doctors. “We’re looking toward the medical community to help us to provide a safe space,” says Finkelman. “We could come up with different ways to make our customers feel safe, but we really need the medical community to help us.”

John Williamson, the general manager at Wells Street Market, echoed that view. “Unfortunately, the regulations and stipulations required for reopening are vague right now and we want to make sure we have all the guidelines before we comment,” writes Williamson in an email. “The safety of our staff and guests is our top priority and we’ll share steps we’re taking with you as soon as we have more direction from the government.”

But that hasn’t stopped Chicago chefs and restaurateurs from wondering just how a food hall can possibly adapt.

“Here’s the problem,” says Ravi Nagubadi, owner of Art of Dosa in Revival Food Hall, “everything that is good for a vendor (at a food hall) is predicated on crowds, which are no longer going to be allowed. The financial mechanics of a food hall for the next year or more could be called into question. What made it financially viable in years past is no longer in the new normal.”

The last customers visit Time Out Market in the West Loop on March 15, 2020, as the market announced plans to close indefinitely. Soon after, Gov. J.B. Pritzker announced all bars and restaurants would be closed to dine-in customers beginning March 16, 2020. (Brian Cassella/Chicago Tribune)Brian Enyart, co-owner of Dos Urban Cantina in Time Out Market Chicago, wonders how a food hall would function with so many vendors. “What does that look like?” says Enyart. “Can you have 18 vendors manage 50 guests? That doesn’t seem possible. Can you do delivery out of there? A massive coordinated event? Open up with a couple vendors a couple days a week?”

Even if capacity limits are raised, many chefs worry if there will be enough people downtown, considering some may choose to continue to work from home. “How many people will come back to work in the Loop?” asks Joe Fontana, owner of Fry the Coop in Wells Street Market. “I’m assuming it will be a slow opening with probably only to-go orders offered for a while.”

Antonio Fiasche, owner of Tempesta Market in Wells Street Market, agrees that delivery and pickup will have to be the focus until a vaccine is developed, but still worries about disruptions. “The virus is going to keep going, so every time it spikes, will we shut everything down?” says Fiasche. “How do people downtown pay for rent? It’s going to be a new way to do business.”

Barry Sorkin, owner of Smoque BBQ in the Revival Food Hall, is also concerned about how food halls would work without large crowds, but believes there are too many unknowns at the moment. “It’s really hard to speculate about what is going to happen with food halls, concert venues and movie theaters,” says Sorkin.

Despite the questions and concerns, most food hall owners and restaurateurs won’t count food halls out just yet.

There are 221 food halls in the U.S. today, with another 80 in development, according to Colicchio Consulting, the specialty food, beverage, hospitality and entertainment group of commercial real estate services firm Cushman & Wakefield. By the end of 2021, the number is expected to reach close to 500, the firm said.

Food halls also have attributes chefs may be seeking out after an economic tailspin from which many restaurants will never reopen. Most important, food halls offer low capital costs to open and shared resources, such as the technology to provide pickup and delivery orders.

“I know from my experience in New York right now, there are a lot of people unsure if they’ll be able to open their restaurants afterward,” said Akhtar Nawab, chef and partner at restaurant and food hall consultancy Hospitality HQ, which will operate the planned Dr. Murphy’s Food Hall. “They have the skill set; it’s just they may not have a place to return to. That’s why the food hall is such an interesting model right now.”

Trip Schneck, executive managing director of Colicchio Consulting, believes that when the economy begins to recover, food halls will be well-positioned because of the revenue-sharing rent model. “We are very optimistic that food halls will be one of the primary recovery vehicles for the food and beverage industry,” says Schneck. “Food halls also are at a good price point, below fancier meals but above fast food, and there will be an abundance of talented chefs looking for work after many restaurants shut down.”

“I’m a hopelessly optimistic person,” says Finkelman from 16″ on Center. “I really do see that at some point we’ll come out of this. We’ll be able to look at the safety and the way we’re putting out our product. This is a chance for us to do it better.”

That may mean that they look different from how food halls did before. Touchless transactions, redesigned queuing and reconfigured seating are coming in the short term, industry experts say. Chefs and their landlords hope there will be crowds to manage as soon as the doors reopen.

Didier Souillat, CEO of Time Out Market, believes that the size of many food halls might actually benefit them. “Time Out Market Chicago is 50,000 square feet and as people look for safe options to go out, we have ample space to comply with social distancing rules,” writes Souillat in an email.

When it opens again, Souillat believes that Time Out Market visitors are likely to see masked employees, staggered seating, an emphasis on touchless transactions and cleaning crews constantly moving about the space. “The most important thing we’ll have to manage is the fear factor, and we know it’s going to be there for a long time,” says Souillat later in a phone call. “We’ll open when it’s safe to do so and when it makes viable sense for our partners. There’s no point in opening to lose more money.”

While they had questions about just how food halls would return, many restaurateurs are looking forward to them returning. “I hope they do make it though,” writes Fontano from Fry the Coop, “because food halls rock!”

Urbanspace’s Scott is even more bullish. “What happened after the Spanish flu?” says Scott of the 1918 pandemic. “The Roaring Twenties. People wanted to go out again. There is that pent-up demand.”

nkindelsperger@chicagotribune.com

Can Chicago’s Food Halls Survive the Pandemic?

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