Area restaurants fall victim to economy

A Haile Plantation restaurant and a steak and seafood house on Newberry Road could not outlast the economic plunge and are closing — part of a nationwide, Florida and Gainesville-area trend.

The Third Place Pub and Grille in the Haile Village Center is closing Saturday while Grill Masters on Newberry Road closed July 19.

Both cited the economy and rising costs as the primary reason.

"Sales took a nose dive about the beginning of the year and just got worse," said Grill Masters manager Scott Trowell. "When you are losing money, it is not feasible to stay open. We have three other locations to worry about and the overall health of the company had to be improved."

The owners of Grill Masters also own Northwest Grill, Steak and Pasta Works and Joe's Place/Panama Joe's.

In urban-planning parlance, a "third place" is a location other than home and work at which people gather.

That was the idea behind the Third Place restaurant, operated for more than eight years in the Haile Village Center.

Jenny Byrnes, who owns Third Place with her husband Jason, said several factors played into the decision to close, including a change of ownership in the building that houses the restaurant.

But Byrnes added the business spiralled to near bankruptcy because of the economy.

"Our sales are down 30 percent since 2005. With the price of food as a direct result of the price of gas, one day I'm paying 50 cents a pound for tomatoes and the next I'm paying $3 a pound," Byrnes said. "I'm in the same boat — I can't afford to go out to eat either. I've got a 3-year-old at home and ... we're eating ramen soup too."

Regular patrons are saddened. David Patterson, who lives and works in Haile, said the Village Center is losing more than a restaurant.

"Jenny and Jason are great people and they were great additions to the community. We are definitely going to miss them," Patterson said. "Third Place had a unique feel to it. It was just a great atmosphere. You'd go in and see people you know."

Chains also suffering

Restaurants — both chains and independents — have been suffering with the economy.

The highest-profile closings may be Starbucks, which is shuttering 600 of its coffee shops throughout the U.S., but none in Gainesville.

Nationwide chains such as Chili's and Macaroni Grill have also announced closures.

Jennifer Garner of the Florida Restaurant and Lodging Association said the organization does not keep data on the number of restaurant closings, but said it is happening across the state.

"We have seen restaurants have to close, but this isn't going to last forever and so a lot of restaurants are doing everything they can to stay in business and keep costs down," Garner said. "They are changing menu items and trying to keep customers coming in so they can keep operating."

Economists said dining out is one of the little luxuries in life that gets cut when the economy heads south.

Some people eat out less frequently when times are hard, or scale down to less costly fast-food places.

David Denslow, research economist for the Bureau of Economic and Business Research at the University of Florida, said the bureau is working on a study of consumer habits in troubled times.

"Which would be more likely to close — the upscale or the lower end? We're working on something related to that now," Denslow said. "You would think there would be more failing in a down time. Right now they pretty much have everything going against them.

"Florida has been in a recession since May of last year, and then you have the gasoline prices. That hits them on two fronts — it gives people less discretionary income and it hits the restaurants on the cost side."

Billy Scheel, who own Harry's Seafood Bar and Grille and Mark's U.S. Prime in downtown Gainesville, said they are holding their own.

Harry's is a moderately priced restaurant popular at lunch and dinner, while Mark's is more upscale and open only for dinner.

"I think when you go through this, it filters out some of the weaker ones. But as far as we go, our business is pretty solid — I'm opening a new Mark's in Ocala," said Scheel, who also has a Harry's in Ocala. "I think we have a product downtown of different kinds of restaurants, so that we are kind of a Mecca. We're destination-type restaurants."

Denslow, meanwhile, said it's unlikely Florida residents will be able to regularly splurge anytime soon.

He believes it will take another year or two for Florida's economy to revive.

"Gainesville, sadly, probably a little bit longer," Denslow said. "The long-run prospects for Gainesville look really good. We have the medical care, which continues to be strong, and then there is higher education. The fundamental demand for that continues to be strong.

"But we are going to be constrained by the state budget difficulties and the inability to raise tuition substantially," he added.

Cindy Swirko can be reached at 374-5024 or at swirkoc@ gvillesun.com.