Restaurant sinks in slumping economy

in howard county

Fulton's Trapeze closes after three years of business and critical acclaim

November 09, 2008|By Jonathan Pitts | Jonathan Pitts,

When the upscale restaurant Trapeze opened in Fulton in 2005, critics hailed it as a "playful and sophisticated retreat," a place whose "soaring space" and flavorful fare could turn a quick detour off U.S. 29 into a memorable dining experience.

After three years, the retreat is no more. The first business to open in the Maple Lawn development in southern Howard County - a bit west of the Anne Arundel County line - Trapeze has shut its doors, an apparent victim of the recent economic downturn across the nation and the globe.

"We deeply regret that [the] economic conditions that persist throughout the country forced us to close," owner Alexias Sharoky said in a statement released this week, "and we are also saddened by the loss of jobs to our great staff, many of whom have been with us through thick and thin."

Management broke the news to restaurant workers late last Saturday. The place was closed for business by Sunday night.

The decision reflected less a lack of quality in Trapeze so much as the broader struggles of the dining-out industry on a rough economic landscape, said Richard W. Story, chief of the Howard County Economic Development Authority.

"We haven't done a scientific study of it yet, but I don't think restaurants are doing well anywhere in this economy," he said. "Profit margins are razor-thin. When people lose their pensions on Wall Street, the consumer confidence you need is not there."

Surprisingly enough, some figures actually show growth in the industry in Maryland, said Paul Hartgen, president of the Columbia-based Restaurant Association of Maryland. The state's controller reported a $200 million increase in total sales between last fall and this fall, he said - a result, perhaps, of special measures some restaurateurs took 12 to 18 months ago when they saw "dark clouds on the horizon." Some have saved money by offering smaller portions, others by creating new drink specials or reconceptualized menus.

Still, Hartgen said, surveys taken a year ago showed that more restaurant operators saw the recruiting and retention of employees as their biggest concern than any other factor. This year, the economy outpaced every other consideration by a wide margin, and the state saw a net loss of 48 restaurants over the past year.

Stewart Greenebaum, Maple Lawn's developer, was "surprised and disappointed" to hear Trapeze was among them. A regular customer, he said he often met Washington or Baltimore clients there and quickly fell in love with the seafood club sandwich.

"They were doing pretty near everything right," Greenebaum said. "The food was great; the pricing [$31 to $50 for a dinner entr?e] was right. What was terribly wrong was the economy."

As gas prices and unemployment have risen, house values dropped and pension plans diminished, the "perfect storm" developed for Trapeze's demise, he said.

Nationwide, fine-dining chains such as Morton's and Ruth's Chris Steakhouse, and more moderately priced ones such as the Cheesecake Factory, have seen their stocks lose up to 70 percent in value.

"[These conditions] don't give anyone, including me, the feeling, 'Hey, I want to go out and throw $100 bills around,' " Greenebaum said. "It has played especially hard on upscale restaurants."

Trapeze isn't the only Maple Lawn eatery to have felt recession-like effects. Across the street at oZ Chophouse, co-owner Katie Buscher said eateries in the development have been competing for too few customers.

"There just aren't enough people in Maple Lawn to split between us, Trapeze, and Anazul [a neighboring tapas bistro], especially during midday hours," Buscher said.

Early last month, oZ stopped serving lunch altogether.

"Businesses are definitely looking for ways to adapt," Story said.

Whether Trapeze's fate reflects the broader fortunes of Maple Lawn depends on whom you ask. Greenebaum, founding partner of Greenebaum & Rose Associates, a Baltimore real estate firm, plans for Maple Lawn to include nearly 1,200 homes, many of them luxury residences, and nearly 2 million square feet of retail space in time.

With a Harris Teeter store slated to open in August, the commercial side of the development is proceeding ahead of schedule - Greenebaum said several interested parties have contacted him about leasing the Trapeze space - but the pace has been much more sluggish on the residential side. Only about 250 homes are completed and occupied, and the development he originally expected would take eight years to complete could take 10 or 12.

"On the residential side of the business, I don't have to tell you that there's a major slowdown," he said.

Did that housing slowdown hasten the restaurant's demise? Greenebaum said the economy is such that even if there were an additional 200 occupied houses right now, it wouldn't have made much difference. Buscher, the oZ co-owner, disagreed.

"Especially during lunch, you need the local customers. ... The slow [home] sales are a major damper on business," she said.

The springing-up of restaurants there was impressive, said Story, who praised Trapeze as "the first to test the waters." Buscher called it a first-class restaurant.

Alan Berrier, a management consultant at Trapeze, said the restaurant had been growing at "a modest rate." But because going to restaurants is always high on consumers' discretionary spending list, however, there was little margin for error.

"Any business closing is a painful experience, one that goes well beyond the financial losses," he said. "People are involved. That is the saddest part."

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