On July 6, Bloomberg carried a story wrapping up the day’s activity on Wall Street. It was a bad day for the market. The news began, “U.S. stocks fell as oil prices breached $61 for the first time …″ One salient point leapt out:
Restaurant chains such as Darden Restaurants Inc. and IHOP Corp. slumped after a Raymond James analyst said rising gasoline prices may cut into their customers’ dining budgets.
Oil prices have backed off some since that record, but they are on an inevitable march upward. New York City, like many other old northeast cities, was largely built before the automobile. It is more convenient not to have a car here, and New Yorkers’ disposable income will be less affected than others’ by rising gasoline prices.
It’s safe to assume that of all the IHOP restaurants in the country — all those identical single-use buildings set back behind ample free parking on sprawling commercial strips — there is at least one that will continue to draw customers as oil and gasoline prices rise. It is pictured above — the new IHOP at 135th Street and Adam Clayton Powell Jr. Boulevard (Seventh Avenue) in Harlem. Unlike the cookie-cutter IHOPs everywhere else, this one doesn’t even have a single off-street parking space. Nor are there any lots or garages nearby. If you want to go to this IHOP, you might take the No. 2 or 3 train, or the B or the C, or the Bx33 or M2 buses, or you might come from a nearby building. In any event, you have to be prepared to walk. My girlfriend and I tried to get a table there on a Sunday some weeks ago, but the wait to be seated was 40 minutes, so we left for a less packed spot. According to this press release, this IHOP is the 14th most lucrative out of the 1,167 IHOPs in the U.S. and Canada, and on Sundays it serves 500 people per hour for eight straight hours.
Although chains like McDonald’s and Burger King have been here in New York City for many decades, there has been a recent uptick in the level of interest in other national chains that have never had a presence in New York City, and have traditionally taken development patterns that would be anathema to the way we do business here. Most famoustly, the Home Depot and Costco have opened stores, and even Wal-Mart tried, before being shut down by a quickly mobilized cross section of humanity. Perhaps the reason for this heightened interest is the fact that chain stores are starting to realize they need to diversify their store base to include places that don’t depend on automobile transport for their business. Whether they realize it or not, in a future without cheap oil, chain stores will need urban locations if they are to have any hope of remaining profitable.
Below is a photograph of the new building that includes the IHOP in question. It opened a year ago, but celebrated an official grand opening last October with an appearance by Mayor Bloomberg and Congressman Charles B. Rangel. This is another cutting edge project built in Harlem by the Abyssinian Development Corporation. It is an appropriately scaled high density mixed use building. Beyond the IHOP, most of the building houses the Thurgood Marshall Academy, a public middle and high school.
- U.S. Stocks Fall as Oil Prices Surge to Record; Darden Declines [Bloomberg]
- Mayor Serves Harlem Pancakes [Gothamist]
- White & Case LLP, Deutsche Bank Americas Foundation and Pancakes – A Recipe For Success [White & Case]
- Developer Drops Plan for City’s First Wal-Mart [The New York Times]