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Eldon Scott of UrbanSpace on Modernizing the Communal Food Hall · Masters in Business

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  Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.
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  Speaker 1: This week on the podcast, I have a special guest.
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  Speaker 1: His name is Eldon Scott, and he is president of
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  Speaker 1: Urban Space, which is the New York branch of a
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  Speaker 1: fascinating company that began life in London, England. If you
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  Speaker 1: have gone to any of the new and very hip
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  Speaker 1: food courts around New York City, I'm partial to the
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  Speaker 1: one on Vanderbilt and but they're all over Manhattan, you
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  Speaker 1: will have experienced some of Urban Spaces work. They are
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  Speaker 1: just really really good at totally recreating the concept of
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  Speaker 1: a food court. You know, when I think of food courts,
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  Speaker 1: I think of the terrible mall based um, really awful
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  Speaker 1: chain foods. What they do is they go out and
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  Speaker 1: find the most interesting chefs, entrepreneurs hip places in Brooklyn
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  Speaker 1: and they bring them to Manhattan as food stalls, and
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  Speaker 1: and some of them are just The food is fantastic.
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  Speaker 1: The vibe and the energy in these places are just amazing.
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  Speaker 1: I strongly suggest that if you're anywhere near New York
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  Speaker 1: City and have an opportunity to try one of these places,
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  Speaker 1: you really like it. They also do all of the
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  Speaker 1: holiday uh sales um temporary spaces that pop up in
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  Speaker 1: places like Brian Park and Grand Central Station. Uh. Again,
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  Speaker 1: no chains, just unique one off merchants and entrepreneurs and designers.
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  Speaker 1: Really really interesting thing. If you are at all interested
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  Speaker 1: in food and how various chefs become popular, uh, and
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  Speaker 1: about the future of how food is going to be
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  Speaker 1: served in places like conference facilities, malls, etcetera, then this
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  Speaker 1: is something you actually absolutely have to listen to. With
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  Speaker 1: no further ado. My conversation with Eldon Scott. My special
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  Speaker 1: guest this week is Elden Scott. He is the president
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  Speaker 1: and CEO of urban Space, a unique real estate, dining
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  Speaker 1: and retail establishment that given how difficult retail has been
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  Speaker 1: these days, I thought it would be nice to bring
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  Speaker 1: someone in who has achieved a high degree of success
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  Speaker 1: in retailing and restaurateuring. Uh. Eldon went to undergraduate at
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  Speaker 1: Yale University. He then moved on to the London School
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  Speaker 1: of Economics before joining Urban Space in London. The London
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  Speaker 1: Urban Space was founded in nineteen seventy by Eric Reynolds,
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  Speaker 1: where it has since developed more than fifty sites, focusing
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  Speaker 1: on artisanal and casual food and unique holiday fairs in
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  Speaker 1: Eldon left London for New York City, where he opens
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  Speaker 1: Urban Space, the first one in America, focusing on the
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  Speaker 1: holiday fair in Grand Central. Now, Urban Space has a
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  Speaker 1: number of locations in New York uh the Vanderbilt Market,
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  Speaker 1: five seventy Les, Times Square, Madison Square, Broadway Bites, the
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  Speaker 1: Garment District. They also run a number of different holiday
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  Speaker 1: fairs Grand Central Station, Brian Park, Union Square, Columbus Circle.
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  Speaker 1: And the company is about to take this unique business
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  Speaker 1: model national. Eldon Scott, welcome to Bloomberg. Thank you so
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  Speaker 1: much so so I hope I did that justice in
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  Speaker 1: explaining sort of what what urban spaces. It's a fairly
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  Speaker 1: unique model. Before we get into the details of it,
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  Speaker 1: let's talk a little bit about your background. Um, you
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  Speaker 1: mentioned you're a boarding school kid. You end up going
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  Speaker 1: to Yale and then London School of Economics led you
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  Speaker 1: to Urban Space in London after you got out of
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  Speaker 1: ls A. You know, I've always lived in residential types
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  Speaker 1: of communities through boarding school and then at Yale, and
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  Speaker 1: you know, these these great colleges, we have wonderful dining
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  Speaker 1: halls and one of the hearts of universities are these
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  Speaker 1: dining halls. So I've always finished in this idea of
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  Speaker 1: community and meeting other people around food and in communal
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  Speaker 1: seating as well. So I think there's a little bit
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  Speaker 1: of inspiration from those experiences that I took with me
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  Speaker 1: to London. So did you go straight to urban space
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  Speaker 1: out of London School of Economics or were there any
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  Speaker 1: Um My background is urban planning in real estate, so
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  Speaker 1: I worked in the coch Administration in the Department of
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  Speaker 1: City Planning for a while. It's my first job new Haven,
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  Speaker 1: New York City urban Planning. Then Lesse studied urban planning
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  Speaker 1: and economics, and then I worked for Savills, which is
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  Speaker 1: a property company in London. So I had some traditional
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  Speaker 1: real estate and planning background. So then how did you
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  Speaker 1: still belong to urban space? Well, you know, like a
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  Speaker 1: lot of other young people on London, I was going
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  Speaker 1: up to Camden Locke on the weekends, which was a
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  Speaker 1: great place if you haven't been there, it's it's north
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  Speaker 1: side of London and it's a fantastic, very busy spot.
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  Speaker 1: And I was talking to my professor from LC one
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  Speaker 1: day and I was like, I love this place, Camden
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  Speaker 1: lock I gotta meet Eric Reynolds. He's a friend of mine,
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  Speaker 1: so I met Eric and shortly thereafter I left Savage
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  Speaker 1: and started working with him at Urban Space. So he
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  Speaker 1: set up Urban Space in the UK in nine seventy.
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  Speaker 1: When when this was first brought to the four there,
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  Speaker 1: did they have to raise capital or did it just
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  Speaker 1: sort of start small and and go from there. It
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  Speaker 1: started the small and went from there. Having said that,
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  Speaker 1: there were a couple of investors that Eric brought in
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  Speaker 1: early on with Camden Locke. I mean Camden grew to
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  Speaker 1: become the third or fourth biggest visitor destination in London
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  Speaker 1: and was a real phenomenon at the time because you
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  Speaker 1: have to remember in the seventies there were trading laws.
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  Speaker 1: You couldn't open on Sundays UM, but you could open
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  Speaker 1: markets on Sundays. So it was one of the first,
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  Speaker 1: if not the first large private market to open in
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  Speaker 1: London UM at that time. And it just really drew
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  Speaker 1: and it got a lot of the youth culture coming down.
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  Speaker 1: So that was a regulatory loophole. You couldn't have regular
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  Speaker 1: retail open, but open air marketplace was allowed to run exactly.
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  Speaker 1: And the same question in the United States. You come
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  Speaker 1: here with the intention of setting up urban Space, new York.
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  Speaker 1: Did you have to raise capital or by that time
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  Speaker 1: was there enough capital from London. It was already had
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  Speaker 1: enough capital by that time to to get going, So
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  Speaker 1: we just applied the knowledge experience we had. I was
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  Speaker 1: wanting to bring it to New York for a long
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  Speaker 1: time because I was, you know, living in London, traveling
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  Speaker 1: to a lot of European capitals, and it was such
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  Speaker 1: a great market culture in Europe that I knew there
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  Speaker 1: was something would be great in the United States. So
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  Speaker 1: I wanted to bring it back. So I have been
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  Speaker 1: writing about and talking about the death of retail for
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  Speaker 1: it seems like a decade, if not longer. And part
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  Speaker 1: of retail has to do with the the dining experience,
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  Speaker 1: the traditional mall in America, it's a handful of chains.
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  Speaker 1: It's a handful of well known, nothing unique, nothing special.
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  Speaker 1: Are we at the edge of the death of the
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  Speaker 1: food court? Is that going the way of the Dodo Bird?
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  Speaker 1: I don't think we're the it's the death of the
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  Speaker 1: food court. I think that the food hall is a
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  Speaker 1: variation on an old theme and it's it's a new segment,
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  Speaker 1: if you will. But I think there's still a lot
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  Speaker 1: of other concepts which are gonna, you know, continue to
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  Speaker 1: thrive as well. There's gonna be more food options, not less,
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  Speaker 1: so the food court might be replaced with a food
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  Speaker 1: hall or something a little more hip or a little
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  Speaker 1: more innovative. Is that a fair assessment. The main difference
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  Speaker 1: really is that the food hall has generally speaking, more
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  Speaker 1: local and chef driven concepts. So let's talk about that
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  Speaker 1: a little bit. I go to the one on Vanderbilt
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  Speaker 1: all the time. I'm a huge fan of Delaney Chicken.
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  Speaker 1: It's the greatest chicken sandwich I've ever had. Uh. Mr
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  Speaker 1: Byng is just absolutely unique and um just a favorite.
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  Speaker 1: And then there's a shop called Dough which does the
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  Speaker 1: biggest donuts I've ever seen in my life, and they're
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  Speaker 1: crazy delicious. Um, as are everything I've tasted. This is
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  Speaker 1: a completely different approach to feeding people. It's not like
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  Speaker 1: in New York you walk into a Delhi and there's
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  Speaker 1: ninety seven different serving stations and you can get anything
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  Speaker 1: from Medio, compizza or whatever. This is the opposite of that.
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  Speaker 1: This is very specific artisanal foods. It's it's a bottom
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  Speaker 1: up um business model versus a top down business model.
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  Speaker 1: So instead of a large restaurant company that's got a
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  Speaker 1: you know, senior management, and they're planning out what the
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  Speaker 1: menus are going to be. We're really, we're truly market operators.
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  Speaker 1: So we go to the market and we try to
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  Speaker 1: find out what the coolest concepts are and we bring
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  Speaker 1: them into one facility. You know, markets are two thousand
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  Speaker 1: years old and people have had that kind of experience
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  Speaker 1: where you can match consumers and vendors in the central
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  Speaker 1: place and the central places the market operator and that's
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  Speaker 1: what we are. So one analogy we give is it's
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  Speaker 1: a little bit like an artificial reef. So if you
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  Speaker 1: ever been snorkeling, you go out, you find a good area,
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  Speaker 1: you drop down a bunch of old tires and old
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  Speaker 1: cinder blocks, but the real color or the fish that
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  Speaker 1: are coming. So it's not the architecture, it's not it's
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  Speaker 1: not all the planning per se. It's just bringing together
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  Speaker 1: market forces. Is bringing together the best of other businesses
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  Speaker 1: and putting them together. I read an interesting report recently
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  Speaker 1: from Kushman and Wakefield. They pointed out New York City
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  Speaker 1: has twenty five or so active permanent food halls with
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  Speaker 1: another dozen or so planned, but nationwide they think the
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  Speaker 1: number of these food holes will hit three hundred is that?
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  Speaker 1: Is that a real number? Three hundred foot holes around
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  Speaker 1: the country rate. It's funny. I was talking to the
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  Speaker 1: guys that Kushman a couple of weeks ago, and we
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  Speaker 1: actually think it's probably much higher than that, really because
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  Speaker 1: not all the things that are in the pipeline or
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  Speaker 1: even being discussed. Um, I think there's gonna be too
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  Speaker 1: much of it. It's gonna probably be some overbuilding and well,
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  Speaker 1: but that happens in every every hot new trends eventually
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  Speaker 1: reaches saturation and then it's too much for and that
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  Speaker 1: that's true whether we're talking about fried chicken sandwiches or
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  Speaker 1: man buns. At a certain point, it just it just
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  Speaker 1: goes too far. So we mentioned Delaney Chicken and some
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  Speaker 1: of some of my other favorites. I have to ask you,
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  Speaker 1: how do you source vendors every You just opened up
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  Speaker 1: one on Lexington Avenue five seventy where Mr Kay's used
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  Speaker 1: to be. You know that restaurant for a million years,
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  Speaker 1: and it's just a completely different set of hip, funky restaurants.
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  Speaker 1: How do you guys consistently find such interesting vendors to
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  Speaker 1: sell such unique food. We have a we have a
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  Speaker 1: little bit of an advantage because we have our own
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  Speaker 1: farm League set up, so we have these pop up
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  Speaker 1: markets that we've been doing for years all around the city.
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  Speaker 1: So we're in Madison Square, We're in we're in Bryant
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  Speaker 1: Park in Square, and this is around the holidays. Usually
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  Speaker 1: last couple of months is too open. Right now, Um
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  Speaker 1: Square and Herald Square their food only markets. So what
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  Speaker 1: we do is we bring people in and we try
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  Speaker 1: them out. Because you know, you can have a great food,
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  Speaker 1: you can be a great operator. You can be a
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  Speaker 1: super highly followed chef. But we're looking for people that
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  Speaker 1: are not just don't just have a great following, they're
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  Speaker 1: also really good operators. You can also be a great
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  Speaker 1: chef and not how to know how to cook in volume.
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  Speaker 1: There's a big leap it takes to go from having
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  Speaker 1: a tasty item to be able to serve a thousand
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  Speaker 1: of those items pretty quickly. And I will tell listeners,
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  Speaker 1: if you walk over to the Vanderbilt one, it's on
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  Speaker 1: forty Street in Vanderbilt. At five to twelve, you can
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  Speaker 1: walk in and walk into any vendor and get whatever
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  Speaker 1: you want. At five after twelve, there's it's just flooded
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  Speaker 1: with people, especially millennials and young people, and then after
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  Speaker 1: two thirty again it empties out. That's got to be
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  Speaker 1: a challenge to manage that sort of crush for any
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  Speaker 1: chef or restaurant um operator. Yeah, and we're kind of
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  Speaker 1: partner with the chefs in the space to help give
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  Speaker 1: them the infrastructure that they need. Sometimes they like more infrastructure,
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  Speaker 1: more storage, etcetera, etcetera. UM. But the ones that figure
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  Speaker 1: it out do really well, and luckily not too many don't.
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  Speaker 1: But I think that they kind of learned from each other,
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  Speaker 1: so they'll look down the I almost say, hey, why
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  Speaker 1: is that guy cranking it? Why is this line moving?
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  Speaker 1: And they'll start to learn. But having said that, it's
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  Speaker 1: there's a big skilled jump from being a good chef
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  Speaker 1: to really producing quality and volume. So you you talked about, um,
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  Speaker 1: how trendy. A lot of this is I think your
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  Speaker 1: vendors are the most on trend foods in town. Not
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  Speaker 1: surprised that you. The new place has a Raman specialists.
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  Speaker 1: There's a ton of niche sort of foods. It's not
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  Speaker 1: just oh I'm going to open a Chinese food. Mr.
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  Speaker 1: Byng is a perfect example. It's a very specific niche.
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  Speaker 1: So my question is how intense is the competition for people, um,
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  Speaker 1: for chefs and others who want into the next urban
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  Speaker 1: space market, and how do you make that that decision
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  Speaker 1: This person is good, this person um may not be
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  Speaker 1: an excellent fit. It's competitive because they're great locations and
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  Speaker 1: the chefs want to be in those locations. So what
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  Speaker 1: we do is we have a separate department that does leasing,
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  Speaker 1: and we're looking at sales data from our other markets
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  Speaker 1: are pop up markets, and if we see something that
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  Speaker 1: looks like it's doing really well, we let the public decide.
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  Speaker 1: We don't tell us. We all should read social media
• 13:41
  Speaker 1: and all that kind of stuff, and then all the
• 13:44
  Speaker 1: senior people will go to that restaurant and we'll see
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  Speaker 1: what we like about the food, about the menu, about
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  Speaker 1: the environment, about the service, and will make sure that
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  Speaker 1: there's a whole list of things will look at to
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  Speaker 1: make sure it's the best vendor in that sector. So
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  Speaker 1: you mentioned you track sales and stuff. What metrics do
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  Speaker 1: you look at to determine if a given space is
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  Speaker 1: meeting your expectations or if a given vendor is being successful.
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  Speaker 1: You know, there's a lot of different metrics you can
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  Speaker 1: look at at the end of the day, it's sales
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  Speaker 1: sales volume. Well, what other metrics would you even consider?
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  Speaker 1: Obviously volume is um important, but is it consistent volume?
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  Speaker 1: You could I've seen some days. Well, it's different day parts,
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  Speaker 1: you know. You know, some vendors are going to be
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  Speaker 1: better at lunch. I'm gonna do better after work. You know.
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  Speaker 1: If we want to have a few things that will
• 14:32
  Speaker 1: work for for breakfast, so we will put someone in
• 14:35
  Speaker 1: with the lower sales volume, just because it's filling a
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  Speaker 1: niche that we need. So there's it's it's science and art.
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  Speaker 1: It's it's all mixed again to the mix. And I
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  Speaker 1: first became familiar with the concept of a food haul
• 14:48
  Speaker 1: years ago when Italy opens up UM, and I have
• 14:53
  Speaker 1: my favorite Italian places. So I'm probably not the ideal
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  Speaker 1: person to talk to about Italy because I have my
• 15:00
  Speaker 1: other favorite pasta places and favorite um pizza places. But
• 15:04
  Speaker 1: what did you think of when you saw a concept
• 15:06
  Speaker 1: like Italy, uh come into play. It's a great model.
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  Speaker 1: It's essentially a more top down model. I mean, there
• 15:14
  Speaker 1: are some sub tenants in there, but it's primarily more
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  Speaker 1: of a planned uh you know, food concept with stations. Um,
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  Speaker 1: it's interesting because we had our first all food pop
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  Speaker 1: up market at Madison Square outside of the first Italy,
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  Speaker 1: and I remember at that time people saying, yeah, that's
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  Speaker 1: really great, but you know, outside as an actual market.
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  Speaker 1: From the perspective of individual vendors and entrepreneurs, you know,
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  Speaker 1: you're not necessarily going to meet the entrepreneur at in Italy,
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  Speaker 1: but you're very well going to meet the entrepreneur or
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  Speaker 1: the chef at one of the food halls of one
• 15:45
  Speaker 1: of the food markets. I one one day my wife
• 15:48
  Speaker 1: had heard me talk about Mr Bing for forever, and
• 15:51
  Speaker 1: she was here for a show and it was four
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  Speaker 1: in the afternoon, so I said, hey, it's not crowded,
• 15:56
  Speaker 1: let's walk over there and grab a Mr Bing and
• 15:59
  Speaker 1: person who built it was there. We had a whole conversation. Yeah.
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  Speaker 1: I went to school in China and I studied and
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  Speaker 1: we always love this street vendor and there was nothing
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  Speaker 1: like it here in the States. And this worked out perfectly,
• 16:11
  Speaker 1: which which leads to a question, given that there are
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  Speaker 1: so many different restaurants in New York, Um, can these
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  Speaker 1: little pop ups compete with the restaurant? Do they have
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  Speaker 1: the ability to go toe tootell with someone who's there,
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  Speaker 1: who's going to see people or is this a totally
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  Speaker 1: different market. I mean, obviously there's some crossover, but it's
• 16:30
  Speaker 1: a different market. We're not doing full service. If you
• 16:33
  Speaker 1: want to have a great business lunch with five people
• 16:36
  Speaker 1: and you want to have a reservation and waiter service,
• 16:39
  Speaker 1: you're probably not gonna go to a food hall. But
• 16:41
  Speaker 1: if you're okay with a little more bustling environment for
• 16:43
  Speaker 1: a business lunert sometimes people are, then you know that's
• 16:46
  Speaker 1: where you might want to go. And do you think
• 16:48
  Speaker 1: of urban Space as a real estate play or is
• 16:51
  Speaker 1: it a restaurant play? Everyone asked it set it's a
• 16:55
  Speaker 1: little bit both. Were really a real estate company from
• 16:57
  Speaker 1: the perspective that we acquire property and we sub lease property,
• 17:02
  Speaker 1: but we also act like an FMP brand, and we
• 17:05
  Speaker 1: also see ourselves as more of a brand than most
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  Speaker 1: real estate companies would. I was trying to explain urban
• 17:11
  Speaker 1: Space to a friend who's not from New York but
• 17:13
  Speaker 1: understands we work, and I said, it's we work for
• 17:15
  Speaker 1: food and they kind of got that. Let's talk a
• 17:19
  Speaker 1: little bit about the holiday fairs, because that's how I
• 17:22
  Speaker 1: first discovered UM who you folks were who Urban space was? Um?
• 17:29
  Speaker 1: Grand Central Station has a giant holiday fair every holiday season,
• 17:34
  Speaker 1: Brian Park, you guys take over the park, Union Square
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  Speaker 1: Holiday Market Columbus Square Holiday Market for many years every
• 17:42
  Speaker 1: holiday I got my wife a gift from Deborah Armstrong,
• 17:46
  Speaker 1: who was an artisan and jewelry designer. How did the
• 17:50
  Speaker 1: concept of these pop up temporary holiday fairs come about? Well,
• 17:57
  Speaker 1: I mean I came back from London and I was
• 17:59
  Speaker 1: I was used to go into these Chris Kindall's markets
• 18:02
  Speaker 1: in which are throughout Europe, and we didn't really have
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  Speaker 1: a strong tradition of those in the States. Uh, this
• 18:09
  Speaker 1: was gosh, I don't know. In nineties, late nineties. Um,
• 18:13
  Speaker 1: so I first approached Grand Central Terminal and they just
• 18:17
  Speaker 1: renovated the main waiting room. This is going back a
• 18:19
  Speaker 1: lot of years. And they said, well, may it may
• 18:22
  Speaker 1: not work, but give it a shot. So we did.
• 18:24
  Speaker 1: You wasn't like years of haggling and negotiating. It was
• 18:27
  Speaker 1: just you have this empty space, I'd like to use
• 18:30
  Speaker 1: it for a holiday fair. It will generate revenue for
• 18:32
  Speaker 1: the for the station. How does that sound? And that? Okay?
• 18:36
  Speaker 1: Sure it was a test at first, you know, later on,
• 18:38
  Speaker 1: there was a lot more negotiating, haggling. You're aware that
• 18:41
  Speaker 1: that is not the usual way stuff gets done in
• 18:44
  Speaker 1: in New York City. Well, you know, there weren't a
• 18:47
  Speaker 1: lot of great users of public spaces back in the nineties.
• 18:51
  Speaker 1: You know, there were a lot of as many concepts.
• 18:53
  Speaker 1: There's a lot more great concept there's a lot more
• 18:54
  Speaker 1: great street food today there wasn't back then. So people
• 18:58
  Speaker 1: were looking for things like this, and Grand Central Station
• 19:02
  Speaker 1: was was at full The renovation finished not that long ago,
• 19:07
  Speaker 1: less than a ten years ago, the full full renovation.
• 19:11
  Speaker 1: The main the main part of that. This was just
• 19:14
  Speaker 1: the south waiting room. Is that the waiting room, and
• 19:16
  Speaker 1: then we moved it shortly thereafter to an outdoor uh
• 19:20
  Speaker 1: situation at Union Square, so that was a little bit larger.
• 19:24
  Speaker 1: And so when I lived on Lexington Avenue, we would
• 19:27
  Speaker 1: have a street fair every year, and it was very
• 19:29
  Speaker 1: quickly became boring and repetitive. It was the same junk
• 19:35
  Speaker 1: tube socks and just regular commercial stuff. Why have the
• 19:40
  Speaker 1: street fairs failed where your holiday fairs seemed to be
• 19:44
  Speaker 1: very successful and thrive every year. It's about the quality
• 19:48
  Speaker 1: of the product and the curation of the product. So
• 19:50
  Speaker 1: a lot of what we do as the operator is
• 19:52
  Speaker 1: curation and storytelling because we're trying to find vendors that
• 19:57
  Speaker 1: our entrepreneurs from New Yorker sometimes beyond you or and
• 20:00
  Speaker 1: have a real story and a real craft or something
• 20:02
  Speaker 1: to bring to the consumer. So let's talk about the
• 20:06
  Speaker 1: numbers behind that. I read somewhere about the vendors are
• 20:10
  Speaker 1: local for meither New York or the surrounding areas, and
• 20:15
  Speaker 1: are international. Is that more or less accurate something like that?
• 20:20
  Speaker 1: I mean, we we've had a guy forever who came
• 20:22
  Speaker 1: from comes from Colorado. Once a year he makes candles,
• 20:27
  Speaker 1: loads up his van, comes to New York. So New
• 20:29
  Speaker 1: York is known as a place that the hallidays, where
• 20:31
  Speaker 1: you can sell products, and then you will. I also
• 20:35
  Speaker 1: read that you have an unusually high percentage of women
• 20:38
  Speaker 1: and minority vendors. Is that right, that's a huge number. Yeah.
• 20:43
  Speaker 1: I think that's this reflective of the entrepreneurial community and
• 20:49
  Speaker 1: getting access to, you know, great real estate so they
• 20:52
  Speaker 1: can sell. So that's it's an outcome of what's out
• 20:55
  Speaker 1: there in the marketplace. And let me give you a
• 20:59
  Speaker 1: quote of yours and get a comment, because I love
• 21:02
  Speaker 1: this perspective. Most retail in America is top down, where
• 21:07
  Speaker 1: you have national chains that have bios who decide what
• 21:10
  Speaker 1: fashions are and distribute down to stores our models. The opposite,
• 21:15
  Speaker 1: we're dealing almost exclusively with small independent businesses, not national chains.
• 21:20
  Speaker 1: Is that the difference between a marketplace and a regular
• 21:25
  Speaker 1: sort of retailer. Yeah, I mean that's what we offer
• 21:29
  Speaker 1: over going to a national store. UH and the way
• 21:33
  Speaker 1: our buying gets done. Obviously we're curating, we're meeting, we're
• 21:36
  Speaker 1: looking at product, but at the end of the day,
• 21:38
  Speaker 1: we're looking at their UH, their sales and their behavior
• 21:41
  Speaker 1: and how the consumer likes their product, and that's how
• 21:44
  Speaker 1: we release our change for the next year. So we're
• 21:47
  Speaker 1: really listening to the marketplace. It's a market what's what's
• 21:49
  Speaker 1: the turnover, like how many people are repeat vendors and
• 21:52
  Speaker 1: how many people are fresh faces. We have turnover every year,
• 21:56
  Speaker 1: sometimes not because of the products. Sometimes people move on,
• 21:59
  Speaker 1: they get they get larger. UM the Body Shop, which
• 22:03
  Speaker 1: became a major international change, UM had a stall a
• 22:06
  Speaker 1: canden Lock in London in the nineteen seventies. Um she
• 22:09
  Speaker 1: started with a table selling potions. She came from the Midlands,
• 22:12
  Speaker 1: but that was their first London outlets. Sou Saban, which
• 22:16
  Speaker 1: is a pretty big retailer now started with with with
• 22:19
  Speaker 1: stalls and some of the markets, so some of them
• 22:21
  Speaker 1: grow out of it. That's amazing. I mentioned, um your
• 22:25
  Speaker 1: background having worked with the urban space in London, and
• 22:29
  Speaker 1: I read recently that you were looking at Chicago and
• 22:34
  Speaker 1: the West coast. How big do you think the concept
• 22:37
  Speaker 1: of food halls and gift fares can get nationally? Where
• 22:41
  Speaker 1: can this go? Certainly can go further? How much? I
• 22:45
  Speaker 1: don't have the answer to. There's gonna be a lot
• 22:47
  Speaker 1: of it coming because we're not the only ones going
• 22:49
  Speaker 1: into Chicago, going to other cities, so it's gonna be
• 22:51
  Speaker 1: interesting to see who are your competitors, Oh, you know,
• 22:56
  Speaker 1: anything from other restaurateurs that are doing multiple these concepts,
• 23:00
  Speaker 1: or landlords who are putting things in their buildings. So
• 23:03
  Speaker 1: it's really coming from multiple directions. So there's a building.
• 23:07
  Speaker 1: I want to say it's thirty eighth and Broadway. Since
• 23:09
  Speaker 1: you brought this up, and the interesting thing they did
• 23:13
  Speaker 1: with the ground floor is every real estate tenant is
• 23:18
  Speaker 1: a fairly hip new restaurant. I can't say I've ever
• 23:21
  Speaker 1: seen that before. It's a relatively new building. I don't
• 23:24
  Speaker 1: know if you're familiar with that that area, Is that
• 23:28
  Speaker 1: the sort of concept that that might we might see
• 23:31
  Speaker 1: more of. Are those potential competitors out there or there's
• 23:34
  Speaker 1: something that you do. Sure, we would not normally just
• 23:39
  Speaker 1: put a bunch of retailers on a street like that,
• 23:41
  Speaker 1: because we're more interested in the community aspect of what
• 23:45
  Speaker 1: a food hall is. And I think that's one of
• 23:47
  Speaker 1: the compelling things about food halls, is that the interaction
• 23:51
  Speaker 1: between all the various people all in one place at
• 23:55
  Speaker 1: one time. You know, they I think since two at
• 23:59
  Speaker 1: least people have been talking about locals the new luxury,
• 24:02
  Speaker 1: food is the new fashion, and everyone the buzzword is authenticity.
• 24:06
  Speaker 1: You know, we've been dealing with authenticity since the seventies.
• 24:09
  Speaker 1: And we started this because we were always working with
• 24:12
  Speaker 1: local small businesses. UM. For many years we couldn't we
• 24:17
  Speaker 1: weren't considered a major tenant by landlords because they were
• 24:20
  Speaker 1: looking for national credit. Now everyone's looking for authenticity, So
• 24:25
  Speaker 1: you know that the tide has changed. Suddenly, it's inverted,
• 24:28
  Speaker 1: it's it's different than it was. So so speaking of
• 24:30
  Speaker 1: the beginning of nineteen seventies, UM, the person who founded
• 24:34
  Speaker 1: Every Space in London in nineteen seventy was Eric Reynolds,
• 24:38
  Speaker 1: who sort of used the catchphrase lighter, quicker, cheaper um.
• 24:45
  Speaker 1: Is that still the watchword? And is that how you
• 24:48
  Speaker 1: approach setting up a new space? And does the economy
• 24:52
  Speaker 1: itself make a difference in how you operate? Is the
• 24:57
  Speaker 1: economy only makes a difference if humors are buying our products,
• 25:01
  Speaker 1: So we're not as impacted by interest rates or other fluctuations.
• 25:05
  Speaker 1: We're just, you know, we're interested in our people buying
• 25:08
  Speaker 1: our product. I mean, outside of the Great Recession when
• 25:10
  Speaker 1: things were horrific, the economy gets better, it gets what
• 25:14
  Speaker 1: a little worse? Are you guys? Fairly recession proof short
• 25:17
  Speaker 1: of a near depression in UM in two thousand and
• 25:21
  Speaker 1: eight when things were a little rough, I was hiding
• 25:23
  Speaker 1: under my desk along with everyone else, and we had
• 25:25
  Speaker 1: a holiday market at Union Square to put on, so, uh,
• 25:29
  Speaker 1: you know, we came out and it turns out people
• 25:31
  Speaker 1: came out of the woodwork. They wanted to be in
• 25:33
  Speaker 1: the parks, they wanted to be outside, they wanted to
• 25:34
  Speaker 1: be with other people. And that's when we first really
• 25:37
  Speaker 1: started to think in that people are looking for human experience,
• 25:40
  Speaker 1: like an authentic experience, and our sales were up so
• 25:44
  Speaker 1: from your sales were up in two eight. Yes, that's astonishing,
• 25:48
  Speaker 1: but we weren't selling items for selling items, so the
• 25:53
  Speaker 1: thought processes and they're staying away from expensive stores and
• 25:57
  Speaker 1: going to the fairs where they can still find something
• 26:00
  Speaker 1: a little unique and interesting but much more reasonably priced,
• 26:03
  Speaker 1: and looking for experience and connection. And I think that's
• 26:08
  Speaker 1: one of the things that we're able to offer very
• 26:10
  Speaker 1: very different than a retail store experiences when you're actually
• 26:13
  Speaker 1: interacting with not just a vendor, but the entrepreneur who
• 26:16
  Speaker 1: may be the designer or the builder of whatever that
• 26:18
  Speaker 1: particular good he is that's being sold. Yeah. Yeah, And
• 26:22
  Speaker 1: that's a little bit of where the letter cricker cheaper
• 26:24
  Speaker 1: comes from, is that, you know, we're setting up the
• 26:26
  Speaker 1: rough space, um, but we're looking to the vendor to
• 26:30
  Speaker 1: really brand themselves within the parameters of what we give them.
• 26:34
  Speaker 1: So that's you know, people ask us how you can
• 26:37
  Speaker 1: do these things in about four or five days as
• 26:39
  Speaker 1: long it takes us to put these out, and it's
• 26:41
  Speaker 1: because it's you know, many hands to make small work. Right.
• 26:44
  Speaker 1: So a previous guest was Dan Biederman. He was the
• 26:47
  Speaker 1: person who helped design Brian Square Park in an number
• 26:50
  Speaker 1: of other public private projects, and one of the things
• 26:54
  Speaker 1: that stood out from that conversation was he else programming
• 27:01
  Speaker 1: was the key to making a space successful, that you
• 27:05
  Speaker 1: had to bring people in, you had to give them
• 27:06
  Speaker 1: something to do. And it reminds me a little bit
• 27:09
  Speaker 1: of what you're describing, which is the community space, the interaction,
• 27:14
  Speaker 1: the experience, not just buying a sandwich or buying a widget,
• 27:18
  Speaker 1: but the whole overall experience. Is that a fair statement? Sure?
• 27:23
  Speaker 1: I mean what what Dan did with Brian Park was
• 27:26
  Speaker 1: amazing from where that started years ago, right for people
• 27:30
  Speaker 1: who may not be familiar, Brian Park was right west
• 27:34
  Speaker 1: of the New York Public Library. It was a den
• 27:37
  Speaker 1: of iniquity, of drug sales and muggings and just terrible.
• 27:41
  Speaker 1: And it's now one of the great jewels of Manhattan.
• 27:45
  Speaker 1: It really is, and it's actually become a great food
• 27:47
  Speaker 1: area as well. Um. So I think that making public
• 27:50
  Speaker 1: spaces better is very clearly adds to value in and
• 27:55
  Speaker 1: what's happening around those spaces. So I think programming is
• 27:58
  Speaker 1: part of that. So one of the questions I wanted
• 28:01
  Speaker 1: to get to before UM had to do with UM
• 28:05
  Speaker 1: in Paris and in London. I've seen them the gift
• 28:10
  Speaker 1: fares as a permanent not just to pop up UM location,
• 28:14
  Speaker 1: and I read also Tokyo they're a permanent holiday fairs,
• 28:18
  Speaker 1: not temporary holiday affairs. Is that sort of experiences that?
• 28:23
  Speaker 1: Can that work in New York? And can that work
• 28:25
  Speaker 1: in the United States? Or is that a little more
• 28:28
  Speaker 1: continental than the American palette my we have for example,
• 28:32
  Speaker 1: candid Lock, which was an urban space project, is a
• 28:35
  Speaker 1: year round marketplace UM. I think it's hard to set
• 28:41
  Speaker 1: those things up because to get the density and an
• 28:43
  Speaker 1: urban center to do that at a real estate value
• 28:46
  Speaker 1: that makes sense. I haven't seen it very often, so
• 28:49
  Speaker 1: that's one of the reasons why I've done it. Do
• 28:51
  Speaker 1: any plans on trying that in the US? Or is
• 28:53
  Speaker 1: that really best left to the Europeans? I think it's
• 28:57
  Speaker 1: it's not where the trend is right now? Well, where
• 29:00
  Speaker 1: is the trend? What? What do you see as the
• 29:02
  Speaker 1: next offshoot? It's all food for us, It's it's food.
• 29:06
  Speaker 1: It's primarily food. Why is that is food the new entertainment?
• 29:09
  Speaker 1: Is that because it's it's something that people need every
• 29:15
  Speaker 1: day and it's a way to bring people together in
• 29:18
  Speaker 1: a communal experience, and it's a way to connect really
• 29:21
  Speaker 1: creative young businesses UM with consumers in a way that's
• 29:25
  Speaker 1: more exciting than things that they've had in the past.
• 29:28
  Speaker 1: So I have to ask you about urban space itself. Um,
• 29:32
  Speaker 1: when you started in ninety New York, how many people
• 29:35
  Speaker 1: were working with you here in in in the United States?
• 29:38
  Speaker 1: Over year one was just a couple of people, right,
• 29:40
  Speaker 1: And what have you expanded to? How many people are
• 29:42
  Speaker 1: in urban Space today? We're probably in the head office
• 29:47
  Speaker 1: and and what's the relationship with the original London office
• 29:51
  Speaker 1: is that still ongoing? Oh yeah, partners. Eric serves on
• 29:55
  Speaker 1: our board and has an interest in our company. So
• 29:57
  Speaker 1: we talk a lot about trends that are happening in London,
• 30:00
  Speaker 1: trends that are happening in New York and in you know,
• 30:03
  Speaker 1: compared notes, so which really you know, I know, how
• 30:07
  Speaker 1: fashion trends move Paris, Milan, New York and then eventually
• 30:12
  Speaker 1: makes its way west. What direction our food trends going.
• 30:17
  Speaker 1: I was just in the West Loop of Chicago and
• 30:21
  Speaker 1: I was struck by how much it reminded me of Brooklyn.
• 30:24
  Speaker 1: Um not what I expected to see and UM and
• 30:27
  Speaker 1: for people who may not be familiar with that part
• 30:29
  Speaker 1: of Chicago, this was rail tracks and was to die
• 30:33
  Speaker 1: for a long time until I want to say sometime
• 30:36
  Speaker 1: in the mid nineties, maybe it was Oprah Winfrey set
• 30:40
  Speaker 1: up um Harpo Studios there, which is our production company,
• 30:44
  Speaker 1: and that started in renaissance there and now it's just
• 30:48
  Speaker 1: full blown. It reminds me of Hudson Jord's UM here
• 30:52
  Speaker 1: in New York. It's just not cranes everywhere, lots and
• 30:55
  Speaker 1: lots of buildings. Is a big Google office there. What
• 30:59
  Speaker 1: direction do food trends move? Are you seeing this go
• 31:02
  Speaker 1: from you're all to hear vice versa all directions? It's
• 31:07
  Speaker 1: kind of it's kind of crazy. I think that it's
• 31:08
  Speaker 1: something that's bubbling up UM globally. You know. I was
• 31:13
  Speaker 1: speaking with UM, the head of the World Food Street
• 31:18
  Speaker 1: Street Food Congress, just last week, and we think we
• 31:22
  Speaker 1: have a lot of food halls going on here, well
• 31:24
  Speaker 1: in in in Asia and in Singapore. It's it's much
• 31:29
  Speaker 1: beyond what we have here. And this is something that
• 31:31
  Speaker 1: that is global and that's really more of a cultural tradition.
• 31:35
  Speaker 1: Their food stalls and that sort of public communal eating
• 31:39
  Speaker 1: experience seems to be have a much longer history than
• 31:43
  Speaker 1: we have in the United States. It does, but you
• 31:46
  Speaker 1: you still have, uh i'd say, more chef driven concepts
• 31:52
  Speaker 1: even within those contexts, kind of growing up out of
• 31:55
  Speaker 1: out of the of those street markets. Really that that
• 31:59
  Speaker 1: that's quite fastenathing. We have been speaking with Eldon Scott
• 32:02
  Speaker 1: of Urban Space. Be sure and check out my daily column.
• 32:06
  Speaker 1: You can find that on Bloomberg View dot com. Follow
• 32:09
  Speaker 1: me on Twitter at rid Holts. We love your comments,
• 32:12
  Speaker 1: feedback and suggestions right to us at m IB podcast
• 32:16
  Speaker 1: at Bloomberg dot net. I'm Barry Ridholts. You're listening to
• 32:20
  Speaker 1: Master's in Business on Bloomberg Radio. Welcome to the podcast, Eldon,
• 32:37
  Speaker 1: Thank you so much for doing this. I am a
• 32:39
  Speaker 1: huge fan of what you guys do. And one day
• 32:42
  Speaker 1: I was online at Delaney Chicken and looking around, and
• 32:47
  Speaker 1: I said, somebody has to be behind this. This sort
• 32:50
  Speaker 1: of thing doesn't just spring up fully developed on its own.
• 32:55
  Speaker 1: And I started doing a little bit of research and
• 32:58
  Speaker 1: eventually reached out to Urban Space, and and here we are.
• 33:03
  Speaker 1: I have to ask you a couple of questions about
• 33:04
  Speaker 1: your career because a lot of the folks I speak
• 33:07
  Speaker 1: to have followed a very specific career path. They went
• 33:11
  Speaker 1: to college, they went for an m b A, they
• 33:13
  Speaker 1: got a job at a big firm, and then they
• 33:16
  Speaker 1: went to a boutique and then they launched the run shop.
• 33:18
  Speaker 1: There's a fairly clear path. I think what you did
• 33:23
  Speaker 1: is fairly unique. There aren't all that many holiday fair
• 33:28
  Speaker 1: slash food halls around, so there can't be that many
• 33:32
  Speaker 1: businesses doing this, and therefore there can't be that many
• 33:35
  Speaker 1: people with your career path. When when you first accepted
• 33:40
  Speaker 1: the gig, did you realize you were taking such a
• 33:42
  Speaker 1: non traditional career path in in real estate and urban planning.
• 33:47
  Speaker 1: I was young enough so I didn't realize what career
• 33:50
  Speaker 1: I was giving up. I just thought it was exciting.
• 33:53
  Speaker 1: I wanted to do it, and my background was really
• 33:56
  Speaker 1: more urban planning architecture with some real estate, so to
• 34:00
  Speaker 1: me it was a new brainer to get involved with
• 34:01
  Speaker 1: Camdon Locke, which was which was a very exciting place
• 34:03
  Speaker 1: to be and what was the business like in London?
• 34:06
  Speaker 1: Had I know that over the forty so years since
• 34:10
  Speaker 1: the launch they've done fifty pretty substantial projects. When you joined,
• 34:15
  Speaker 1: were they a thriving successful company? The UK have gone
• 34:20
  Speaker 1: through a series of economic expansions and ran into some
• 34:24
  Speaker 1: trouble in the seventies. They got a little better in
• 34:26
  Speaker 1: the eighties, um, and then the nineties everybody exploded. What
• 34:30
  Speaker 1: was it like back then? Was it any bit of
• 34:32
  Speaker 1: an issue? You joined them when? Late eighties? Is that right? Uh? No?
• 34:37
  Speaker 1: The early nineties, Okay, I guess it was late eighties.
• 34:41
  Speaker 1: Trying to remember. Yeah, it was like eighties, eight eighty nine. Um, no,
• 34:45
  Speaker 1: it was. It was a thriving business. It was. It
• 34:47
  Speaker 1: was you know, if you've ever been to London, you
• 34:50
  Speaker 1: went to Canon Candon Locke. Especially back then. It was
• 34:53
  Speaker 1: you know, even more energetic back then. So it was
• 34:56
  Speaker 1: an exciting place to be. And I really got a
• 34:58
  Speaker 1: kind of traditional apprenticeship, uh in a business. So you
• 35:02
  Speaker 1: know I was out there collecting twenty pound notes from fenders,
• 35:06
  Speaker 1: moving stalls around, you know, doing the business from the
• 35:09
  Speaker 1: ground up. So this was really hands on sort of
• 35:14
  Speaker 1: career from from from the start. It was hands on
• 35:17
  Speaker 1: and you know, what you gain is experience. And I
• 35:20
  Speaker 1: think what experiences is seeing patterns, um and what you
• 35:24
  Speaker 1: see if you do something over and over again, because
• 35:26
  Speaker 1: you see, well, if you line up the stalls this way,
• 35:29
  Speaker 1: the sales are gonna be better if you line them
• 35:31
  Speaker 1: up that way. So we learned our own little rules
• 35:33
  Speaker 1: about retail facing retail. How many stalls can you sustain
• 35:37
  Speaker 1: for a market? How much traffic do you need? And
• 35:39
  Speaker 1: really it was just a body of experience that I
• 35:42
  Speaker 1: gained by doing markets now for thirty five years. So no,
• 35:46
  Speaker 1: you're just hit or miss, trying a bunch of things
• 35:48
  Speaker 1: and then iterating with each subsequent UM. Fair to say,
• 35:53
  Speaker 1: here's what we learned with the last one, and slowly
• 35:55
  Speaker 1: but surely it just gets more and more robust. You
• 35:59
  Speaker 1: you learned. That's why it was like an apprenticeship. You
• 36:01
  Speaker 1: learn almost like a craftsperson learns their trade, and you
• 36:04
  Speaker 1: start to understand what the internal rules are of that business.
• 36:08
  Speaker 1: And that's what we've learned about. Any really unique UM
• 36:12
  Speaker 1: experiences stand out, anything that was well, didn't expect that
• 36:16
  Speaker 1: to happen. You can say. One of the interesting things
• 36:19
  Speaker 1: is the quality of the vendors, both chefs and and
• 36:25
  Speaker 1: craftsman has just skyrocketed. UM. So back when I first
• 36:30
  Speaker 1: started doing this in New York in the nineties and
• 36:34
  Speaker 1: early two thousand's, UM, look, there were a lot of
• 36:37
  Speaker 1: there were a lot of great vendors and people making food.
• 36:39
  Speaker 1: But sometime around two eight, when the you know, the
• 36:44
  Speaker 1: Internet and social media was really kicking in and other
• 36:47
  Speaker 1: potential career paths we're looking a little less successful. Um,
• 36:53
  Speaker 1: we suddenly started to see a lot more interesting chefs.
• 36:56
  Speaker 1: You know that the food truck thing was was blowing up.
• 36:58
  Speaker 1: People were off publishing, they were tweeting where they were
• 37:02
  Speaker 1: on a certain corner, and suddenly you had people who
• 37:05
  Speaker 1: might otherwise have been, you know, trying to develop software
• 37:08
  Speaker 1: or get a job in finance, we're saying, hey, you know,
• 37:12
  Speaker 1: I can make a really interesting brand. I can make
• 37:14
  Speaker 1: a food business. And that's actually only continued to get
• 37:18
  Speaker 1: stronger because as you've seen things like shake shacko Public,
• 37:21
  Speaker 1: you've had more private equity firms jump into the space
• 37:25
  Speaker 1: and more opportunity for young people to to create a
• 37:29
  Speaker 1: brand and and and and roll that out. So you
• 37:32
  Speaker 1: alluded to something I have to ask, how significant to
• 37:36
  Speaker 1: the food halls are social media Instagram, Twitter? How big
• 37:42
  Speaker 1: are various people's followings and do they drive traffic to
• 37:46
  Speaker 1: different vendors? Yeah? I think I don't think there's any
• 37:50
  Speaker 1: business that's not touched by social media, and I think
• 37:52
  Speaker 1: that the food halls certainly grown up, the new new
• 37:55
  Speaker 1: version of the food halls grown up with social media.
• 37:58
  Speaker 1: So a lot of consumer now are you know, looking online,
• 38:01
  Speaker 1: Where's where's our food? All wars there the most interesting
• 38:05
  Speaker 1: chicken sandwich and they're finding it online. I read something
• 38:09
  Speaker 1: that certain food companies are changing the packaging of their
• 38:14
  Speaker 1: boxes so they're more Instagram friendly. It's gone that far.
• 38:19
  Speaker 1: Uh do we see vendors making dishes pretty bright, colorful,
• 38:24
  Speaker 1: whatever it is, so that they're more susceptible to a
• 38:28
  Speaker 1: quick snap and neither a tweet or well, you know,
• 38:31
  Speaker 1: fast casual is by nature very instagram morble. So why
• 38:35
  Speaker 1: why is that? Because you you get, you get a plate,
• 38:39
  Speaker 1: you can take a shot on your table, you've got colors,
• 38:42
  Speaker 1: you've got different food and if if there's a story
• 38:44
  Speaker 1: behind that, and it's not just a national chain sandwich, Um,
• 38:49
  Speaker 1: that's something that can be inherent in that, in that
• 38:51
  Speaker 1: Instagram or in that Facebook. So you know, people loved it.
• 38:55
  Speaker 1: I think food is one of the most highly instagram items. Yeah,
• 38:59
  Speaker 1: no doubt about it. So you mentioned earlier narrative, Um,
• 39:04
  Speaker 1: how significant is the narrative process to different food vendors
• 39:09
  Speaker 1: and and different holiday fair uh craftsmen as well. We
• 39:13
  Speaker 1: think it's it's a huge part of it really. We
• 39:16
  Speaker 1: think explained that that that's kind of fascinating. Well, you
• 39:20
  Speaker 1: know you're going to a market or a place like
• 39:23
  Speaker 1: this too, I feel like you're experiencing something that's part
• 39:26
  Speaker 1: of the city or part of that community. So even
• 39:28
  Speaker 1: if you don't know all the details of each of
• 39:31
  Speaker 1: these stories, you get a sense that there are real
• 39:35
  Speaker 1: people here with real life stories that have brought this
• 39:37
  Speaker 1: product to it to you. And these aren't just corporate
• 39:42
  Speaker 1: drones working flipping burgers. These are real chefs and real craftspeople. Well,
• 39:48
  Speaker 1: the control that the main control decisions are very localized.
• 39:52
  Speaker 1: So it's that entrepreneur has decided they're going to sell
• 39:55
  Speaker 1: you know, green sandals or whatever they decide to sell.
• 39:58
  Speaker 1: We're not deciding that. So I think that a consumer
• 40:01
  Speaker 1: sense is that they're not being sold something from on high.
• 40:05
  Speaker 1: This is the result of many individuals making many decisions.
• 40:09
  Speaker 1: Quite interesting. I think that that for us, what we
• 40:11
  Speaker 1: really look for is to create a sense of community, um,
• 40:15
  Speaker 1: and we do that by bringing uh, real live entrepreneurs
• 40:21
  Speaker 1: together and real consumers. And that community and authenticity is
• 40:26
  Speaker 1: inherent in bringing those communities together in a great space.
• 40:30
  Speaker 1: Makes a lot of sense to make. So let me
• 40:32
  Speaker 1: jump to my favorite questions. These are what I ask
• 40:35
  Speaker 1: all of our guests, um tell us the most important
• 40:38
  Speaker 1: thing people don't know about your background that I'm an
• 40:42
  Speaker 1: urban planner? Is that true? Probably? Interesting? Who are some
• 40:47
  Speaker 1: of your early mentors, Esoteric Lee Christopher Alexander, who is
• 40:52
  Speaker 1: an interesting architect and planner who wrote a book called
• 40:56
  Speaker 1: a Pattern Language, and he really thought about urban spaces
• 41:01
  Speaker 1: as a series of vignettes or patterns that get put
• 41:05
  Speaker 1: together into a language. And what's interesting about it is
• 41:07
  Speaker 1: that a lot of his thinking was was picked up
• 41:10
  Speaker 1: by software engineers in Silicon Valley in the seventies and eighties.
• 41:15
  Speaker 1: So there's an interesting tie in between what's happening with
• 41:18
  Speaker 1: our perception of urban spaces and what's happening with the
• 41:21
  Speaker 1: idea of frames in Instagram or a Facebook and how
• 41:25
  Speaker 1: things are organized. What other architects, urban planners, real estate
• 41:29
  Speaker 1: developers influenced your approach to thinking about food hales or
• 41:34
  Speaker 1: holiday affairs. The Rouse Company, you know what, the Festival Marketplace,
• 41:39
  Speaker 1: which really came around the time at the Boston Tennial.
• 41:42
  Speaker 1: I was a kid at the time. I grew up
• 41:43
  Speaker 1: in Boston, so I'd take the training and I got
• 41:46
  Speaker 1: a I got a Fannial Hall. I'd read the Boston
• 41:49
  Speaker 1: Globe Real Estate section, and I got excited about the
• 41:52
  Speaker 1: idea of markets in the idea of reusing buildings. Probably
• 41:55
  Speaker 1: at that time. I've noticed that whenever there's a form
• 41:59
  Speaker 1: of um urban renewal, and probably the broadest version of
• 42:04
  Speaker 1: this I've seen recently has been in Portland's These buildings
• 42:08
  Speaker 1: that were once used for one specific set of purposes
• 42:11
  Speaker 1: have now been There were mills, they were mining, smelters
• 42:14
  Speaker 1: and things like that. Suddenly they become these very hip
• 42:17
  Speaker 1: retailers and restaurants. Is that what you're referring to when
• 42:21
  Speaker 1: you talk about repurposing. I think there was an earlier
• 42:24
  Speaker 1: phase of market repurposing that started in the seventies that
• 42:29
  Speaker 1: you know, the Rass Company was a leader in that.
• 42:31
  Speaker 1: You Camden Locke started at that time. I went to
• 42:35
  Speaker 1: a markets conference a couple of years ago at Pike's Place,
• 42:37
  Speaker 1: and actually Pike's Place was renovated and repurposed in this
• 42:41
  Speaker 1: in the mid seventies. Is that what we're talking about Seattle,
• 42:45
  Speaker 1: and we had um Eric from London, the guys from
• 42:48
  Speaker 1: Pike's Place, we had other guy from South Africa. And
• 42:51
  Speaker 1: it was interesting talking to people who had been involved
• 42:54
  Speaker 1: at that time redeveloping things. And it was very real
• 42:58
  Speaker 1: estate driven. It was like, we got this great warehouse,
• 43:01
  Speaker 1: let's reuse it. Today it's different. I think that what's
• 43:05
  Speaker 1: happening today is it's very vender driven. It's about the entrepreneur.
• 43:10
  Speaker 1: The space is critical, but it's first and foremost about
• 43:13
  Speaker 1: the creativity and the idea of who the vendor is.
• 43:15
  Speaker 1: And we have many more great vendors than we did
• 43:17
  Speaker 1: back then in the seventies. So everybody's favorite question. Tell
• 43:22
  Speaker 1: us about some of your favorite books, be they real estate, food,
• 43:25
  Speaker 1: architecture related or not. What what are you reading? What
• 43:27
  Speaker 1: do you like? Um? I read. I read a lot
• 43:31
  Speaker 1: of history, you know, I'm fascinated with the history of cities.
• 43:34
  Speaker 1: I read a lot about about London, about New York,
• 43:37
  Speaker 1: about other about other great cities and how they developed,
• 43:40
  Speaker 1: and the economies of these cities and how the economy
• 43:44
  Speaker 1: is interwoven with um how these places have been set up.
• 43:48
  Speaker 1: Give us a few book titles. Oh, I love the
• 43:51
  Speaker 1: you know the biography of the Wright brothers, and you know,
• 43:56
  Speaker 1: if you read the first chapter of that, you know
• 43:58
  Speaker 1: the Right brothers were bicycle repair people, but they were
• 44:03
  Speaker 1: working in a vibrant city in the nineteenth century where
• 44:06
  Speaker 1: you had, you know, a lot of entrepreneurs and a
• 44:08
  Speaker 1: lot of access to parts and pieces and ideas and
• 44:11
  Speaker 1: a lot of idea of there's no limitation to what
• 44:14
  Speaker 1: they could do, and the individual entrepreneur or inventor could
• 44:18
  Speaker 1: really put things together and make something new happen. And
• 44:21
  Speaker 1: I think what's really exciting to me working in the
• 44:24
  Speaker 1: sectors that I see that energy. I see it in Brooklyn,
• 44:28
  Speaker 1: now I see it in Boston and Chicago. There's a
• 44:31
  Speaker 1: lot of young entrepreneurs who feel empowered by the Internet
• 44:34
  Speaker 1: and by the technology to go out and create something
• 44:38
  Speaker 1: quite quite interesting. So, so since you started working in
• 44:41
  Speaker 1: this space, what has changed? How is it different today
• 44:45
  Speaker 1: than it was in the early nineties. What's different today
• 44:50
  Speaker 1: is technology has changed everything. Therefore, the consumer preference or
• 44:57
  Speaker 1: what consumers are looking for has shifted quite a bit.
• 45:00
  Speaker 1: So there's much more interest, which I didn't anticipate what
• 45:02
  Speaker 1: happened in markets and in entrepreneurs. So that's exciting. I
• 45:08
  Speaker 1: would Well, that leads me to my next question, Um,
• 45:12
  Speaker 1: what is it that you're most excited about right now?
• 45:15
  Speaker 1: Beyond technology which is changing everything, what really drives me
• 45:21
  Speaker 1: and I in a lot of our company is creating
• 45:25
  Speaker 1: great places that are social places. So we're not hopefully
• 45:30
  Speaker 1: always going to be stuck in our car or home
• 45:34
  Speaker 1: looking at our computers. That we can create great places
• 45:38
  Speaker 1: where you can be out and leading a civic life,
• 45:41
  Speaker 1: if you will, meeting other people, brushing shoulders, meeting entrepreneurs.
• 45:44
  Speaker 1: And I think that's a big part of our mission.
• 45:46
  Speaker 1: Tell us about a time you failed and what you
• 45:48
  Speaker 1: learned from the experience. Oh, I've had plenty of bad markets,
• 45:53
  Speaker 1: and I think markets that have filled and I think
• 45:56
  Speaker 1: that that's something that currently a lot of our is
• 46:00
  Speaker 1: jumping in don't have the experience of knowing that these
• 46:03
  Speaker 1: markets just don't work everywhere, and you know they go bad,
• 46:07
  Speaker 1: they go bad fast because you don't have a national
• 46:09
  Speaker 1: tenant who's signed a tenure. Least, you've got a local guy,
• 46:13
  Speaker 1: and that they're leaving the second they're not making money,
• 46:15
  Speaker 1: they're walking out the door. So this does not work everywhere.
• 46:18
  Speaker 1: And I think a good fifty percent of what's being
• 46:22
  Speaker 1: planned right now won't last in the long run really,
• 46:25
  Speaker 1: so so there is no long ramp up if this
• 46:29
  Speaker 1: these don't come out of the gate working, they have
• 46:32
  Speaker 1: a what is it a ninety day window before people say,
• 46:35
  Speaker 1: you know, it takes it takes a good year because
• 46:38
  Speaker 1: everyone's got great intentions and they're working hard. But you
• 46:41
  Speaker 1: know a lot of we we've worked with um a
• 46:44
  Speaker 1: group that that that works with small businesses, and they've
• 46:47
  Speaker 1: done surveys. A lot of these small businesses don't even
• 46:49
  Speaker 1: know if they're profitable. They don't have the books, the bookkeeping,
• 46:53
  Speaker 1: or they're not on top enough of what's going on.
• 46:55
  Speaker 1: So it may take them a year to realize that
• 46:57
  Speaker 1: this isn't working for them. Really, that's amazing. I would
• 47:00
  Speaker 1: think if they're not profitable, they're writing a check to
• 47:03
  Speaker 1: cover it, you would think they would be aware where
• 47:06
  Speaker 1: unless they have capital with another they're living day to
• 47:10
  Speaker 1: day and they're as long as they're able to pay
• 47:12
  Speaker 1: a bill they're hoping for the sales went increase, So
• 47:15
  Speaker 1: so a new market opens up and it's more or
• 47:17
  Speaker 1: less got a year to catch on or else. So
• 47:20
  Speaker 1: what happens vendors start to leave. When do you make
• 47:22
  Speaker 1: the decision, Hey, this isn't working, We're gonna pull the
• 47:25
  Speaker 1: plug when the vendors leave. So it becomes an easy
• 47:29
  Speaker 1: at the point, Right, how often does that happen? What?
• 47:33
  Speaker 1: What's your success rate? Like, you know, early on, I'd
• 47:37
  Speaker 1: say two thirds okay, but even still a third failing
• 47:42
  Speaker 1: is a pretty Uh that's a pretty big number. And
• 47:45
  Speaker 1: now much less because now we're much more cautious. You're
• 47:48
  Speaker 1: more cautious, or you just more experienced than knowing what
• 47:50
  Speaker 1: works and what does in or some combination experienced and cautious.
• 47:54
  Speaker 1: We you know, we get inquiries almost daily and we
• 47:58
  Speaker 1: say no, no percent of the time from the space
• 48:02
  Speaker 1: or from the vendors or who's who's making the inquiries. Um, landlords, Hey,
• 48:07
  Speaker 1: we'd love to set up an urban space here. Yeah,
• 48:10
  Speaker 1: and so I look at a place like Vanderbilt. That's
• 48:13
  Speaker 1: got to be a fairly long term lease. I assume, right,
• 48:17
  Speaker 1: this isn't a pop up. This is there for a while. Um,
• 48:20
  Speaker 1: you have lots of other spaces that people approach you
• 48:23
  Speaker 1: about like that. Yeah, I mean, look, there's a retail
• 48:27
  Speaker 1: is soft. There's a lot of people looking for for tenants.
• 48:31
  Speaker 1: Um Ton of empty storefronts, even even Manhattan, which is
• 48:35
  Speaker 1: robust and thriving, lots of lots of empty spaces. Yeah,
• 48:39
  Speaker 1: and there's gonna be a little bit of price adjustment,
• 48:42
  Speaker 1: you know, rents will adjust a little bit. There's other downward,
• 48:46
  Speaker 1: you know. I think that I talked to a lot
• 48:48
  Speaker 1: of people. I think there'll be other tenants backfilling those spaces.
• 48:52
  Speaker 1: But clearly it's a It's a great market to be
• 48:55
  Speaker 1: in if you have a a concept that's making money
• 48:57
  Speaker 1: right now, right and um so, how many more urban
• 49:01
  Speaker 1: space type food halls can Manhattan's support you can open?
• 49:05
  Speaker 1: We're opening, definitely opening more in Manhattan. You know, we
• 49:08
  Speaker 1: think our trade area is fairly fairly tight. All right,
• 49:11
  Speaker 1: So you're a going to guess you're sticking to Midtown
• 49:14
  Speaker 1: and downtown by the financial district and maybe Hudson Yards.
• 49:19
  Speaker 1: Is that, uh, we're looking at those places, yeah, and others.
• 49:24
  Speaker 1: I would assume is it driven more by the office
• 49:27
  Speaker 1: worker or is it driven by I look at the
• 49:30
  Speaker 1: Upper east Side or the Upper west Side. You have
• 49:33
  Speaker 1: a lot of residences and not as many offices. Can
• 49:36
  Speaker 1: can an urban space work in an area like that?
• 49:39
  Speaker 1: Or do you need the crush of that lunchtime rush.
• 49:43
  Speaker 1: There's a lot of different customer bases, so it could.
• 49:47
  Speaker 1: It can be residential, it can be tourism, it can
• 49:49
  Speaker 1: be office. Obviously there's different patterns to each one of those. Sure,
• 49:54
  Speaker 1: so tell us what you do outside of the office
• 49:56
  Speaker 1: for fun when you're not thinking about architecture and urban planning.
• 50:00
  Speaker 1: What do you do to relax or kickback. I do
• 50:02
  Speaker 1: a lot of ski trips with my kids, and we
• 50:06
  Speaker 1: do a lot of stuff together as a family. So
• 50:08
  Speaker 1: we're skiing, we're playing tennis, were hiking and doing Tuckerman's
• 50:11
  Speaker 1: Ravine next month. Where is tucking about Washington? Oh, so
• 50:15
  Speaker 1: that's a that's a serious well for the East Coast.
• 50:20
  Speaker 1: What advice would you give to a recent college graduate
• 50:23
  Speaker 1: or a millennial who was considering working in retail architecture
• 50:29
  Speaker 1: or urban planning or any of those sort of work
• 50:32
  Speaker 1: that you do, and they were looking for a little
• 50:36
  Speaker 1: guns what would you tell them? Definitely, just jump in,
• 50:40
  Speaker 1: you get a job, get some experience, um, and start
• 50:44
  Speaker 1: start doing it. I think that you need the experience.
• 50:48
  Speaker 1: I think if you tried to start, for example, a
• 50:50
  Speaker 1: food brand too early without knowing all the ins and outs,
• 50:54
  Speaker 1: it could be difficult. On the other hand, if your
• 50:57
  Speaker 1: capital etta isn't that high, you'll gain exp is by
• 51:00
  Speaker 1: doing it, even if the first one doesn't work. And
• 51:03
  Speaker 1: our final question, what do you know about urban planning?
• 51:07
  Speaker 1: Rest you touring holiday fairs food halls today that you
• 51:12
  Speaker 1: wish you knew twenty plus years ago when you were
• 51:14
  Speaker 1: first getting started. What would have been helpful twenty years
• 51:17
  Speaker 1: ago to know that today you just take for granted.
• 51:20
  Speaker 1: I think what is easier today probably didn't exist twenty
• 51:25
  Speaker 1: years ago, which is, you know, access to landlords in
• 51:28
  Speaker 1: capital But that's that's just shifted m so to one
• 51:31
  Speaker 1: more about capital markets in real estate than than I
• 51:34
  Speaker 1: did when I started. But it was it was it
• 51:37
  Speaker 1: was tougher to find spaces years ago. That's that's that's
• 51:41
  Speaker 1: quite interesting. We have been speaking with Eldin Scott of
• 51:45
  Speaker 1: Urban Space. If you enjoy this conversation, be sure and
• 51:48
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• 51:51
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• 51:55
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• 51:59
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• 52:03
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• 52:07
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• 52:09
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• 52:13
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• 52:18
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• 52:23
  Speaker 1: I'm Barry Ritults. You've been listening to Masters in Business
• 52:26
  Speaker 1: on Bloomberg Radio