Consumers are spending plenty of time and money eating out. But where they are eating when they do dine out continues to change.
Colliers International highlighted this trend in its recently released first-quarter retail report for the Minneapolis-St. Paul area.
Colliers says that in the Twin Cities — as in most Midwest markets — higher-quality fast-casual restaurants are expected to thrive, while many more traditional sit-down restaurant chains are expected to struggle. Colliers pointed to such chains as Applebee's, Ruby Tueday's and Buffalo Wild Wings as examples of traditional sit-down eateries that are expected to have a sluggish year in the Twin Cities.
The reason? Colliers says that diners are increasingly choosing faster, more affordable and healthier options when dining out. And the old-school chains don't necessarily fit in with these desires.
As Colliers says in its report: "The competitive and ever-changing nature of the restaurant retail landscape is forcing the retail giants of the past to reinvent themselves as newcomers in the market."
As an example of the woes of more traditional restaurant chains, Buffalo Wild Wings is closing two of its PizzaRev restaurants in the Twin Cities area, one in Edina's Centennial Lakes development and a second at Knollwood Crossing in Hopkins. Both of the locations, part of the Buffalo Wild Wings chain, opened just three years ago.
Of course, the struggles faced by traditional restaurants doesn't mean that even popular fast-casual chains won't face challenges in 2017 and beyond. In the Twin Cities market, for instance, fast-casual restaurants are now facing an upcoming minimum wage of $15. This, Colliers reports, could mean a boost in menu prices, which could impact business.
