Ray Washburne on Why Retail Won't Overbuild

Bisnow
Charter Holdings' Ray Washburne Speaking At A Bisnow Event

Everyone’s shopping and eating out so much that it's easy to see those markets getting overheated from the excitement. But there’s three governors keeping retail and restaurants in check this time around, according to Charter Holdings CEO Ray Washburne (the owner of Highland Park Village and one of the founders of the Mi Cocina and Taco Diner restaurant chains) at the Bisnow DFW Retail event on Tuesday. First, after the ‘80s SNL debacle with 110% to 120% financing available, today’s lenders are more leery and require around 20% to 25% equity to pencil a deal. Second, because of the equity requirements demanding higher returns, fewer retailers are going public and getting that infusion of cash. Third, land prices are high.

Ray also spilled the beans on the decision not to keep Patrizio’s at Highland Park Village. He says the restaurant industry is constantly changing and to keep customers coming back, operators have to keep up with technology and the competition. Last year, Ray’s restaurants served 8 million customers and to maintain that, the restaurants have to stay relevant, he says. About 15 new restaurants opened last year by 20 of his former employees; to stay a step ahead of them, his concepts have to stay fresh. For Patrizio’s, Ray says the $4M in annual sales were good, but the restaurant hadn’t "remained relevant." The quality and the décor had declined over the years and he wanted to bring in something new, so he opted for a Hillstone concept.

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