The first two words we offered in last year’s preview of the OC restaurant business were “fast-casual.”
“Go public” would’ve worked just as well, because two OC-based chains—one of them fast-casual—did just that.
For 2015, here are two more words: for sale:
• The publicly traded parent company of the Newport Beach-based Pacific Rim fusion chain Roy’s announced its sale this month.
• The publicly traded parent company of Irvine-based Yard House is under new management that has floated a similar idea for its OC-based chain.
• Fast-growing fast-casual pizza operators, including Rancho Santa Margarita-based Pieology Pizzeria—founded by Carl Chang, brother of ex-tennis star Michael Chang—are getting ripe for a merger, acquisition, or link-up with larger well-funded partners.
• Even Irvine-based Taco Bell Corp.—whose ex-boss, Greg Creed, is headed to Louisville, Ky., to run parent company Yum! Brands as Brian Niccol takes Taco Bell’s helm in January—has been the subject of rank speculation that it could be spun off from its publicly traded parent company.
Person to Watch
Greg Trojan
Huntington-Beach based BJ’s Restaurants Inc. seemed to give investors a pleasant surprise with its October quarterly report—revenues up 10%, net income up 78%—that sent its stock soaring 25%.
Those watching the chief executive simply saw the capstone to a year of growth.
The casual-dining restaurant operator, with about 150 sites, mostly in California, had been hit hard by fast-casual chains’ cheaper, faster fare.
Trojan spearheaded a streamlined restaurant redesign that cut building costs by 20% and in June introduced an app for ordering and payment that trims wait times for food.
He cut a deal in April with activist investors for board seats and other changes that include buying back stock.
Margins and income grew, even as same-store sales, guest counts, and average checks were flat or declined.
Company to Watch
Habit Restaurants Inc.
The Irvine-based parent of Habit Burger Grill, run by Chief Executive Russ Bendel, plans 26 to 28 new restaurants in 2015—a nearly 30% growth clip from its current 100—and plans to buck industry trends by doing it largely without franchising.
Only two to four of the new locations will be through franchisee groups in Seattle and Las Vegas.
Instead, it plans to have corporate-owned sites take on established East Coast chains in New Jersey, Washington, D.C., and Florida.
The burger chain, like local predecessors Carl’s Jr. and In-N-Out Burger, has made its bid to go big.
Sure, it had a recent market cap of about $900 million. But going public in November was the least of its moves this year—almost an accounting gambit to clear the decks of debt so it could get to the fun stuff.
