In the context of 2020, being a hot market wasn’t necessarily an honor any city desired. Seemingly overnight, the term “hot” went from connoting an economic boom to warning of a viral epidemic. While no state, county, or city was exempt from COVID-19, responses ran the gamut and have continued to evolve.

Markets that were most adversely impacted in the early days of the coronavirus were not necessarily the fastest or even slowest to recover. For dine-in business at full-service restaurants, recovery reached a ceiling by the end of summer. Although it’s impossible to pinpoint a direct cause for dine-in business becoming somewhat static, Todd Walls, chief innovation officer at consumer intelligence firm Buxton, hypothesizes that all the consumers who could be coaxed to dine out again had done so by mid-September.

“From April until August, we had seen a steady, slow increase across the U.S., and [then it] really plateaued. That leads me to believe that restaurants have gotten all the people that have gone back,” Walls says. “It’s going to take a vaccine or something significant like that to change the trends.”

Using mobile device data (see Methodology), Buxton analyzed dine-in volumes in two time frames to capture a holistic picture of which markets were most adversely affected at the beginning of COVID-19 (Table 1), and which were recouping dine-in business the fastest (Table 2) and the slowest (Table 3) over the summer.

Traverse City follows the rules

Certain geographic clusters formed within the latter two tables. Four of the five quickest-to-recover markets bordered the Great Lakes, and the three slowest-to-recover markets were in the South. Walls suspected that these groupings may correlate to government restrictions in some way, but when he examined the data, he could find no quantitative link.

“One of the difficult things for us … is trying to see what the restrictions are locally. They’re just all over the place,” he says. “But we managed to go through and look into that, and I thought there might be a correlation with that and there wasn’t, and I was actually surprised. From what I could tell, these weren’t the markets that were all shutdown the most.”

In fact, some anecdotes hint that the reverse may be true: Markets that were proactive and stricter in their initial responses set their residents up for an accelerated recovery.

In the period between June 14 and September 12, Traverse City, Michigan, witnessed one of the quickest dine-in recoveries, second only to Las Vegas. Traverse City resident and chef Eric Patterson says that for as difficult as the last several months have been, things could have been much worse. He credits much of that to Michigan Governor Gretchen Whitmer, who received equal parts praise and condemnation for the state’s stringent regulations.

“Our governor has been strict on a lot of things. I think the way she handled the pandemic as a whole has given Michigan the opportunity to open up faster than a lot of other markets,” says Patterson, who co-owns The Cooks’ House with chef Jennifer Blakeslee. “It was painful—don’t get me wrong—and we lost three or four restaurants up here because it was as slow as it was. But I think had she not acted with some of that severity, it could have been even worse.”

The Cooks’ House pivoted to carryout for the first two-and-a-half months of the pandemic before transitioning back to limited on-site business. The fine-dining restaurant, which typically holds eight tables inside, had to cut that capacity to 50 percent, but it was able to compensate with a few additional tables on the porch and under a makeshift tent.

Nestled on Lake Michigan, Traverse City is also a vacation destination—something else that likely played to its advantage over the summer.

“Once everything got opened up again somewhat, northern Michigan is just the perfect place to get out of those closed-in blues that we all have from being locked down,” Patterson says. On the flip side, he worries about the winter ahead when the city slows down and frigid temperatures eliminate al fresco options. “I’m hoping we don’t have to do another shutdown this winter. I’m fearful it’s going to happen,” he adds.

St. Louis drives innovation

In St. Louis, recovery hasn’t been as swift. During the first three months of the pandemic (March 16 to June 13), the city was one of the most adversely impacted. James Beard Award semifinalist Rob Connoley partially attributes this to the city’s inherent character; it’s full of small businesses.

“We’re very much an independent restaurant town, especially if you look at the city more so than the county. [As] smaller operations people, we’re more sensitive to reacting to the COVID restrictions,” Connoley says, adding that caution and practicality likely came into play, as well; businesses closed their doors, and residents sheltered in place.  “The other thing, I think, is just that Midwest sensibility. If you’re talking the first 90 days, … everything just shut down.”

And that’s exactly what Connoley did at his restaurant, Bulrush, which specializes in elevated Ozark cuisine. The Paycheck Protection Program (PPP) helped the restaurant weather those first few months.

In April—when Bulrush should have been celebrating its first anniversary—Connoley sold house-made chocolates for carryout, but that revenue (about $3,000 for the whole month) was a far cry from its usual sales. In May, the restaurant rolled out family meals, and the following month it briefly reopened at limited capacity. That arrangement didn’t last long. Although the space is relatively large, the layout wasn’t conducive with social distancing; the kitchen is in the center within a bar-height square. Bulrush could host close to 100 guests pre-pandemic, but only a dozen with the capacity limitations.

So Bulrush pivoted again. Connoley says he’s known for off-the-wall ideas, which proved a game-changer in this case. Initially he considered a back-alley, drive-thru tasting menu, where guests would get a course, then drive around the block and return for the next course. But as he thought further, certain realities—like handing guests a drink while they drive through a back alley filled with dumpsters—made the idea less appealing.

“There’s enough quirkiness that people will do it, but it’s probably not the feel I would like to have for my meals,” Connoley says. Nevertheless, that initial idea evolved into something more practical. Because Bulrush is situated in St. Louis’ more urban theater district, it doesn’t have the benefit of wide sidewalks or a parking lot to bolster outdoor seating.

Undeterred, the chef and his team launched a Park & Dine program, inspired by the classic drive-in and contemporary brands like Sonic, but with fine-dining panache; the experience is a reservation-only chef’s tasting menu. Guests park outside the restaurant while servers bring the various courses. Interactions between customers and staff may be minimal for safety reasons, but Connoley was adamant that the experience be immersive.

“We’re fine dining; we’re all about telling the story, especially ours, because we’re about historical Ozark cuisine. That was one of the things I missed in carryout; you can’t tell the story anymore,” he says.

To remedy this, Bulrush rolled out a suite of interactive components. QR codes on the trays link to YouTube videos where Connoley and his team tell the story of the dish; these videos are updated a few times each week to reflect the ever-changing menu. Guests can also use Spotify to stream a curated playlist or log into Zoom for live video of the kitchen preparing the dishes. Bulrush even has a virtual retail element that Connoley jokingly compares to the old in-flight, SkyMall experience, where guests can purchase made-in-house goods like hot sauces and vinegars.

For all the thought and care that were put into the Park & Dine experience, customers took it a step farther. “What’s so cool and what we never anticipated is the creativity that diners started bringing to it,” Connoley says. “I think it’s become a one uppance where everyone is like, ‘How can I outdo the pictures that are being put on social media?’”

He’s seen everything from simple flourishes, like guests putting flowers in the dashboard, to more ambitious modifications, like setting up low tables in hatchbacks or converting the cargo hold of a delivery truck to a dining room.

Although Park & Dine brings back some of that full-service flair, Connoley eagerly awaits the day Bulrush can return to business as usual. Like Patterson in Michigan, the chef has his worries around the upcoming winter, when Park & Dine may no longer be feasible. Despite the strong indie spirit in St. Louis and the creativity of restaurateurs, Connoley knows it won’t be enough to see them all through the pandemic.

“The people who don’t have that loyal following yet or who aren’t part of the media darlings or the public relations darlings, those are the ones that I don’t think are going to make it,” he says. “I don’t know what category I’m in. … We’ve been one of the media darlings, but we’re so new, and we’re not in a neighborhood.”

Sin City goes to the ’burbs

Within designated marketing areas, the experiences of different neighborhoods can vary widely. This is perhaps nowhere more apparent than Las Vegas, which posted the most significant recovery over the summer, per Buxton data. The glitzy Strip, which primarily caters to tourists and conference-goers, garners the culinary buzz. But the greater Las Vegas metropolitan area is also home to more than 2 million people who, by and large, have a healthy appetite for dining out—especially at full-service concepts.

“Las Vegas is always way at the top of the chart in terms of the proportion of people that go to full-service restaurants; it’s the nature of the market,” Buxton’s Walls says. “Even the people that live there, not just the people that are traveling there, they tend to go out a lot.”

To that end, Las Vegas and its surrounding suburbs have fostered a tight-knit restaurant community built on local business, not tourism. So while those businesses were adversely affected by the coronavirus, the impact paled in comparison to the havoc wreaked on the attraction-filled Strip.

Chef and restaurateur Sam Marvin operates restaurants in Las Vegas, Los Angeles, and Sacramento, California, which gives him a special perspective on what makes each stand out.

“The chef camaraderie in Las Vegas is better than I’ve seen in any other city I’ve ever lived in or had a restaurant in,” Marvin says. “They’re just taking things to new levels as far as community interaction. I would say it is probably one of the strongest pieces of the community of Las Vegas. I’m not talking about the Strip; take the Strip out of it.” Indeed, Marvin predicts that the largest restaurants—most of which are within major casinos—will have the most difficult time recovering, while restaurants in the suburbs will fare better.

Nevada restaurants have also benefited from stabler policies than some neighboring states. Marvin’s elevated steakhouse concept Echo & Rig operates in Las Vegas and Sacramento, and the pair’s coronavirus experiences have been a world apart. In California, dine-in bans and restrictions are in a seemingly constant state of flux; the first wave of reopenings only lasted a couple of weeks before a spike in COVID-19 cases forced closures. About two months later, the Sacramento outpost of Echo & Rig welcomed guests to its patio at limited capacity, but that only lasted two days before wildfires shut the restaurant down a third time.

By contrast, the Las Vegas location has stayed at 50 percent capacity since dine-in service resumed, and Marvin reports that the restaurant is doing about 70 percent of its typical revenue—this due in part to its nose-to-tail butcher shop, which bolstered its offerings to include butcher boxes.

Even before the pandemic, Echo & Rig sold Thanksgiving Feasts, which fed eight and included a turkey, sides like mashed potatoes and butternut squash soup, desserts, and house-made accoutrements like cranberry sauce. The success of the feasts—which sell out every year—led to Valentine’s Day, Mother’s Day, and Christmas iterations. Now that off-premises options have become a habit for many consumers, Marvin plans to continue offering the feasts and perhaps move to an annual subscription–based model.

As suburban restaurants like Echo & Rig prove their mettle during the pandemic, Marvin hopes it could lead to a renaissance of sorts within Las Vegas.

“You’ve never really had any … celebrity chefs that have started in Vegas. They’ve all come from somewhere, whether it’s Los Angeles or New York or Europe,” Marvin says. He offers Guy Fieri as an example. Although the chef and television personality grew up in Las Vegas, he didn’t open a restaurant in his hometown until after he’d built a name for himself elsewhere.

As the pandemic culls restaurants on the Strip, Marvin thinks hotels and casinos will turn to local chefs; he himself is in talks with one of Caesars’ properties. “I think that they’re really going in that direction of local chefs, and now is good timing for it because [visitors] will come back. It might be six months, 12 months, or 18 months. But when they come back, it will be great to have some local talent.”

 

To places unknown

It’s too early to even hypothesize how various cities will fare through the pandemic. The markets that regained ground in the summer could find that progress dashed come winter. There’s also the possibility that relocation spurred by COVID-19 will change the makeup of many regions.

Regardless of how things ultimately shake out, foodservice professionals are unified in their prediction that the remaining restaurants will have more opportunities, thanks to markets that are no longer oversaturated and competitively priced real estate.

“I do think the ones that survive are going to be incredibly successful and busy,” Bulrush’s Connoley says. “We already see that in the neighborhood joints that have been around.”

This could be even more pronounced in markets that have historically had a relatively low cost of entry. As Marvin points out, spaces in the more popular suburban neighborhoods of Las Vegas cost less than the least expensive, less desirable areas of Los Angeles.

In the meantime, keeping the lines of communication open might be the best action any restaurant can take to ensure they are among the pack that emerges from this crisis even stronger.

“My advice to a local business would be to advertise everything that they’re doing to overcome the consumers’ fears,” Walls says. “I need somebody to tell me, as a consumer, that I can go and be safe there. So I think it’s communication of your hours, processes you’re going through, and the protective measures that you’re taking to get me to come back in. I think that’s about the only thing that’s going to make a small movement locally until there’s a vaccine.”

Methodology

FSR partnered with consumer intelligence firm Buxton to compare full-service restaurant performance across more than 200 designated market areas. Buxton’s Consumer Impact Dashboard benchmarks consumer traffic volumes using de-identified GPS data from mobile devices. The metric represents the devices and visits observed at each place as a percentage of the total devices within each selected geography. This approach normalizes natural shifts in the overall volume of the underlying data.

Table 1 tracks full-service restaurant visits between March 16 and June 13, 2020, while Tables 2 and 3 track visits between June 14 and September 12.