In dash for dining dollars, restaurant chains flock to Austin


During the first six months of 2016, Austin restaurants had an average of 17,714 transactions.

Together, inbound national chains have almost 100 locations planned for Austin and surrounding communities.

When restaurateurs think of Austin, visions of dollar signs dance in their heads – and for good reason.

A report from shows that, during the first six months of 2016, Austin restaurants had an average of 17,714 transactions. That’s more than any other city in the country.

The average cost of a meal in Austin, found, was just north of $30.

So it’s no surprise that more and more national chains have set their sights on Austin – a city that has produced a number of successful homegrown restaurant chains over the years, such as Chuy’s, Tiff’s Treats, Mama Fu’s Asian House, Torchy’s Tacos and many others.

Together, those inbound national chains, serving everything from soft pretzels to burritos to pizzas, have almost 100 locations planned for Austin and surrounding communities. Some are open now; others will follow in the next few years.

Moe’s Southwest Grill is among the newcomers. The Atlanta-based chain debuted its first Central Texas location this month in Cedar Park. Thirteen more are planned for the metro area.

“Texas is a key growth market for Moe’s and with the new Cedar Park location, we are confident this move will prove successful in helping grow our base of Moe’s lovers in the Austin area and in Texas,” said Peter Ortiz, vice president of franchise development for Moe’s.

New Orleans-based Smoothie King, meanwhile, is looking to potentially double its presence in Central Texas. A new location just came online in Round Rock, and one in Lakeway isn’t far behind.

“Because local residents in the greater Austin area are very health conscious and active, Smoothie King is the perfect brand to expand here,” franchisee Jamie Joyal said.

Franchisees Mike and Michelle Hydes relocated from the Cayman Islands to help Smoothie King boost its presence in the Austin area.

“We handpicked the Westlake, Bee Cave and Lakeway area because we fell in love with the schools, the people and the opportunities available for our kids,” Michelle Hydes said. “It was a big move for our family, but we are grateful that the community has embraced Smoothie King and has made our American dream possible.”

Interest in the Austin metro area is so intense, industry observers say, that some restaurant chains have had trouble locating desirable real estate. Austin’s retail occupancy rate was 96 percent as of mid 2016, according to The Weitzman Group. That’s the highest rate in Texas.

Even with new retail centers coming online, such as ones in the Cedar Park, Dripping Springs and Hutto areas, commercial real estate brokers say space will continue to be at a premium for the foreseeable future.

“Austin has become a competitive and sophisticated food market, while the tight real estate market is driving competition for quality restaurant space,” said Eric DeJernett, a senior vice president in CBRE’s Austin office. “It’s increasingly important for landlords to evaluate best-in-class operators and unique offerings when selecting food-and-beverage concepts.”

Restaurants accounted for 15 percent of all retail spending during the first quarter of 2016, a recent CBRE report found – more than any other sector, including grocery stores.

“We know that the strength of the food-and-beverage category has led to many shopping center owners seeking restaurants as anchor tenants to draw in shoppers, whereas department stores and other retailers previously filled that role,” CBRE executive vice president and restaurant practice leader David Orkin said.

“What’s particularly interesting today is that retail center owners are not only focused on traditional, proven restaurant concepts, but they are more willing than ever to embrace a broader range of emerging and, in some cases, untested concepts. They are willing to take risks to compete.”

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