"The restaurant industry in the higher end is really taking it on the chin," he said, as families cut back on recreational spending and corporations limit expense-account dining and banquet meetings. Sales at high-end steak house chain Ruth's Chris, for example, were off 24% in the third quarter compared with the year-earlier period.
One hot, hip establishment in Hollywood might succeed, he said, "but I would be very skeptical of a chain working in this environment. Outside of New York, L.A. and Las Vegas, trendy concepts are a challenge."
Proof will come, Lyon said, after the honeymoon period of about 18 months is over.
Schenck agreed there were "cautionary tales out there" such as Planet Hollywood's Chapter 11 bankruptcy and Playboy magazine's shuttering of clubs across the country in the 1980s. But sports broadcaster ESPN apparently has been successful in its venture into food and beverage sales in its ESPN Zone sports-themed restaurants, and Schenck thinks his business can make restaurant profits too.
He doesn't want to predict where the next Rolling Stone venue might be, though.
"Let's just see how this works out."