Eldon Scott of UrbanSpace on Modernizing the Communal Food Hall

will have experienced some of Urban Spaces work. They are just really really good at totally recreating the concept of a food court. You know, when I think of food courts, I think of the terrible mall based um, really awful chain foods. What they do is they go out and find the most interesting chefs, entrepreneurs hip places in Brooklyn and they bring them to Manhattan as food stalls, and and some of them are just The food is fantastic. The vibe and the energy in these places are just amazing.

I strongly suggest that if you're anywhere near New York City and have an opportunity to try one of these places, you really like it. They also do all of the holiday uh sales um temporary spaces that pop up in places like Brian Park and Grand Central Station. Uh. Again, no chains, just unique one off merchants and entrepreneurs and designers.

Really really interesting thing. If you are at all interested in food and how various chefs become popular, uh, and about the future of how food is going to be served in places like conference facilities, malls, etcetera, then this is something you actually absolutely have to listen to. With no further ado. My conversation with Eldon Scott. My special

guest this week is Elden Scott. He is the president and CEO of urban Space, a unique real estate, dining and retail establishment that given how difficult retail has been these days, I thought it would be nice to bring someone in who has achieved a high degree of success in retailing and restaurateuring. Uh. Eldon went to undergraduate at Yale University. He then moved on to the London School

of Economics before joining Urban Space in London. The London Urban Space was founded in nineteen seventy by Eric Reynolds, where it has since developed more than fifty sites, focusing on artisanal and casual food and unique holiday fairs in Eldon left London for New York City, where he opens Urban Space, the first one in America, focusing on the

holiday fair in Grand Central. Now, Urban Space has a number of locations in New York uh the Vanderbilt Market, five seventy Les, Times Square, Madison Square, Broadway Bites, the Garment District. They also run a number of different holiday fairs Grand Central Station, Brian Park, Union Square, Columbus Circle. And the company is about to take this unique business model national. Eldon Scott, welcome to Bloomberg. Thank you so much so so I hope I did that justice in

explaining sort of what what urban spaces. It's a fairly unique model. Before we get into the details of it, let's talk a little bit about your background. Um, you

mentioned you're a boarding school kid. You end up going to Yale and then London School of Economics led you to Urban Space in London after you got out of ls A. You know, I've always lived in residential types of communities through boarding school and then at Yale, and you know, these these great colleges, we have wonderful dining halls and one of the hearts of universities are these

dining halls. So I've always finished in this idea of community and meeting other people around food and in communal seating as well. So I think there's a little bit of inspiration from those experiences that I took with me to London. So did you go straight to urban space out of London School of Economics or were there any Um My background is urban planning in real estate, so I worked in the coch Administration in the Department of City Planning for a while. It's my first job new Haven,

New York City urban Planning. Then Lesse studied urban planning and economics, and then I worked for Savills, which is a property company in London. So I had some traditional real estate and planning background. So then how did you still belong to urban space? Well, you know, like a lot of other young people on London, I was going up to Camden Locke on the weekends, which was a great place if you haven't been there, it's it's north side of London and it's a fantastic, very busy spot.

And I was talking to my professor from LC one day and I was like, I love this place, Camden lock I gotta meet Eric Reynolds. He's a friend of mine, so I met Eric and shortly thereafter I left Savage and started working with him at Urban Space. So he set up Urban Space in the UK in nine seventy. When when this was first brought to the four there, did they have to raise capital or did it just sort of start small and and go from there. It

started the small and went from there. Having said that, there were a couple of investors that Eric brought in early on with Camden Locke. I mean Camden grew to become the third or fourth biggest visitor destination in London and was a real phenomenon at the time because you have to remember in the seventies there were trading laws. You couldn't open on Sundays UM, but you could open markets on Sundays. So it was one of the first, if not the first large private market to open in

London UM at that time. And it just really drew and it got a lot of the youth culture coming down. So that was a regulatory loophole. You couldn't have regular retail open, but open air marketplace was allowed to run exactly. And the same question in the United States. You come here with the intention of setting up urban Space, new York. Did you have to raise capital or by that time was there enough capital from London. It was already had enough capital by that time to to get going, So

we just applied the knowledge experience we had. I was wanting to bring it to New York for a long time because I was, you know, living in London, traveling to a lot of European capitals, and it was such a great market culture in Europe that I knew there was something would be great in the United States. So I wanted to bring it back. So I have been writing about and talking about the death of retail for

it seems like a decade, if not longer. And part of retail has to do with the the dining experience, the traditional mall in America, it's a handful of chains. It's a handful of well known, nothing unique, nothing special. Are we at the edge of the death of the food court? Is that going the way of the Dodo Bird? I don't think we're the it's the death of the food court. I think that the food hall is a variation on an old theme and it's it's a new segment,

if you will. But I think there's still a lot of other concepts which are gonna, you know, continue to thrive as well. There's gonna be more food options, not less, so the food court might be replaced with a food hall or something a little more hip or a little more innovative. Is that a fair assessment. The main difference really is that the food hall has generally speaking, more local and chef driven concepts. So let's talk about that a little bit. I go to the one on Vanderbilt

all the time. I'm a huge fan of Delaney Chicken. It's the greatest chicken sandwich I've ever had. Uh. Mr Byng is just absolutely unique and um just a favorite. And then there's a shop called Dough which does the biggest donuts I've ever seen in my life, and they're crazy delicious. Um, as are everything I've tasted. This is

a completely different approach to feeding people. It's not like in New York you walk into a Delhi and there's ninety seven different serving stations and you can get anything from Medio, compizza or whatever. This is the opposite of that. This is very specific artisanal foods. It's it's a bottom up um business model versus a top down business model. So instead of a large restaurant company that's got a you know, senior management, and they're planning out what the

menus are going to be. We're really, we're truly market operators. So we go to the market and we try to find out what the coolest concepts are and we bring them into one facility. You know, markets are two thousand years old and people have had that kind of experience where you can match consumers and vendors in the central place and the central places the market operator and that's what we are. So one analogy we give is it's

a little bit like an artificial reef. So if you ever been snorkeling, you go out, you find a good area, you drop down a bunch of old tires and old cinder blocks, but the real color or the fish that are coming. So it's not the architecture, it's not it's not all the planning per se. It's just bringing together market forces. Is bringing together the best of other businesses and putting them together. I read an interesting report recently

from Kushman and Wakefield. They pointed out New York City has twenty five or so active permanent food halls with another dozen or so planned, but nationwide they think the number of these food holes will hit three hundred is that? Is that a real number? Three hundred foot holes around the country rate. It's funny. I was talking to the guys that Kushman a couple of weeks ago, and we actually think it's probably much higher than that, really because not all the things that are in the pipeline or

even being discussed. Um, I think there's gonna be too much of it. It's gonna probably be some overbuilding and well, but that happens in every every hot new trends eventually reaches saturation and then it's too much for and that that's true whether we're talking about fried chicken sandwiches or man buns. At a certain point, it just it just goes too far. So we mentioned Delaney Chicken and some

of some of my other favorites. I have to ask you, how do you source vendors every You just opened up one on Lexington Avenue five seventy where Mr Kay's used to be. You know that restaurant for a million years, and it's just a completely different set of hip, funky restaurants. How do you guys consistently find such interesting vendors to

sell such unique food. We have a we have a little bit of an advantage because we have our own farm League set up, so we have these pop up markets that we've been doing for years all around the city. So we're in Madison Square, We're in we're in Bryant Park in Square, and this is around the holidays. Usually last couple of months is too open. Right now, Um Square and Herald Square their food only markets. So what we do is we bring people in and we try

them out. Because you know, you can have a great food, you can be a great operator. You can be a super highly followed chef. But we're looking for people that are not just don't just have a great following, they're also really good operators. You can also be a great chef and not how to know how to cook in volume. There's a big leap it takes to go from having a tasty item to be able to serve a thousand

of those items pretty quickly. And I will tell listeners, if you walk over to the Vanderbilt one, it's on forty Street in Vanderbilt. At five to twelve, you can walk in and walk into any vendor and get whatever you want. At five after twelve, there's it's just flooded with people, especially millennials and young people, and then after two thirty again it empties out. That's got to be a challenge to manage that sort of crush for any

chef or restaurant um operator. Yeah, and we're kind of partner with the chefs in the space to help give them the infrastructure that they need. Sometimes they like more infrastructure, more storage, etcetera, etcetera. UM. But the ones that figure it out do really well, and luckily not too many don't. But I think that they kind of learned from each other, so they'll look down the I almost say, hey, why is that guy cranking it? Why is this line moving?

And they'll start to learn. But having said that, it's there's a big skilled jump from being a good chef to really producing quality and volume. So you you talked about, um, how trendy. A lot of this is I think your vendors are the most on trend foods in town. Not surprised that you. The new place has a Raman specialists. There's a ton of niche sort of foods. It's not just oh I'm going to open a Chinese food. Mr. Byng is a perfect example. It's a very specific niche.

So my question is how intense is the competition for people, um, for chefs and others who want into the next urban space market, and how do you make that that decision This person is good, this person um may not be an excellent fit. It's competitive because they're great locations and

the chefs want to be in those locations. So what we do is we have a separate department that does leasing, and we're looking at sales data from our other markets are pop up markets, and if we see something that looks like it's doing really well, we let the public decide.

We don't tell us. We all should read social media and all that kind of stuff, and then all the senior people will go to that restaurant and we'll see what we like about the food, about the menu, about the environment, about the service, and will make sure that there's a whole list of things will look at to make sure it's the best vendor in that sector. So

you mentioned you track sales and stuff. What metrics do you look at to determine if a given space is meeting your expectations or if a given vendor is being successful. You know, there's a lot of different metrics you can look at at the end of the day, it's sales sales volume. Well, what other metrics would you even consider? Obviously volume is um important, but is it consistent volume? You could I've seen some days. Well, it's different day parts,

you know. You know, some vendors are going to be better at lunch. I'm gonna do better after work. You know. If we want to have a few things that will work for for breakfast, so we will put someone in with the lower sales volume, just because it's filling a niche that we need. So there's it's it's science and art. It's it's all mixed again to the mix. And I first became familiar with the concept of a food haul years ago when Italy opens up UM, and I have

my favorite Italian places. So I'm probably not the ideal person to talk to about Italy because I have my other favorite pasta places and favorite um pizza places. But what did you think of when you saw a concept like Italy, uh come into play. It's a great model. It's essentially a more top down model. I mean, there are some sub tenants in there, but it's primarily more

of a planned uh you know, food concept with stations. Um, it's interesting because we had our first all food pop up market at Madison Square outside of the first Italy, and I remember at that time people saying, yeah, that's really great, but you know, outside as an actual market.

From the perspective of individual vendors and entrepreneurs, you know, you're not necessarily going to meet the entrepreneur at in Italy, but you're very well going to meet the entrepreneur or the chef at one of the food halls of one of the food markets. I one one day my wife had heard me talk about Mr Bing for forever, and she was here for a show and it was four in the afternoon, so I said, hey, it's not crowded, let's walk over there and grab a Mr Bing and

person who built it was there. We had a whole conversation. Yeah. I went to school in China and I studied and we always love this street vendor and there was nothing like it here in the States. And this worked out perfectly, which which leads to a question, given that there are so many different restaurants in New York, Um, can these little pop ups compete with the restaurant? Do they have the ability to go toe tootell with someone who's there, who's going to see people or is this a totally

different market. I mean, obviously there's some crossover, but it's a different market. We're not doing full service. If you want to have a great business lunch with five people and you want to have a reservation and waiter service, you're probably not gonna go to a food hall. But if you're okay with a little more bustling environment for a business lunert sometimes people are, then you know that's where you might want to go. And do you think of urban Space as a real estate play or is

it a restaurant play? Everyone asked it set it's a little bit both. Were really a real estate company from the perspective that we acquire property and we sub lease property, but we also act like an FMP brand, and we also see ourselves as more of a brand than most real estate companies would. I was trying to explain urban Space to a friend who's not from New York but understands we work, and I said, it's we work for

food and they kind of got that. Let's talk a little bit about the holiday fairs, because that's how I first discovered UM who you folks were who Urban space was? Um? Grand Central Station has a giant holiday fair every holiday season, Brian Park, you guys take over the park, Union Square Holiday Market Columbus Square Holiday Market for many years every holiday I got my wife a gift from Deborah Armstrong, who was an artisan and jewelry designer. How did the

concept of these pop up temporary holiday fairs come about? Well, I mean I came back from London and I was I was used to go into these Chris Kindall's markets in which are throughout Europe, and we didn't really have a strong tradition of those in the States. Uh, this was gosh, I don't know. In nineties, late nineties. Um, so I first approached Grand Central Terminal and they just renovated the main waiting room. This is going back a lot of years. And they said, well, may it may

not work, but give it a shot. So we did. You wasn't like years of haggling and negotiating. It was just you have this empty space, I'd like to use it for a holiday fair. It will generate revenue for the for the station. How does that sound? And that? Okay? Sure it was a test at first, you know, later on, there was a lot more negotiating, haggling. You're aware that that is not the usual way stuff gets done in

in New York City. Well, you know, there weren't a lot of great users of public spaces back in the nineties. You know, there were a lot of as many concepts. There's a lot more great concept there's a lot more great street food today there wasn't back then. So people were looking for things like this, and Grand Central Station was was at full The renovation finished not that long ago, less than a ten years ago, the full full renovation. The main the main part of that. This was just

the south waiting room. Is that the waiting room, and then we moved it shortly thereafter to an outdoor uh situation at Union Square, so that was a little bit larger. And so when I lived on Lexington Avenue, we would have a street fair every year, and it was very quickly became boring and repetitive. It was the same junk tube socks and just regular commercial stuff. Why have the street fairs failed where your holiday fairs seemed to be

very successful and thrive every year. It's about the quality of the product and the curation of the product. So a lot of what we do as the operator is curation and storytelling because we're trying to find vendors that our entrepreneurs from New Yorker sometimes beyond you or and have a real story and a real craft or something to bring to the consumer. So let's talk about the numbers behind that. I read somewhere about the vendors are local for meither New York or the surrounding areas, and

are international. Is that more or less accurate something like that? I mean, we we've had a guy forever who came from comes from Colorado. Once a year he makes candles, loads up his van, comes to New York. So New York is known as a place that the hallidays, where you can sell products, and then you will. I also read that you have an unusually high percentage of women and minority vendors. Is that right, that's a huge number. Yeah.

I think that's this reflective of the entrepreneurial community and getting access to, you know, great real estate so they can sell. So that's it's an outcome of what's out there in the marketplace. And let me give you a quote of yours and get a comment, because I love this perspective. Most retail in America is top down, where you have national chains that have bios who decide what

fashions are and distribute down to stores our models. The opposite, we're dealing almost exclusively with small independent businesses, not national chains. Is that the difference between a marketplace and a regular sort of retailer. Yeah, I mean that's what we offer over going to a national store. UH and the way

our buying gets done. Obviously we're curating, we're meeting, we're looking at product, but at the end of the day, we're looking at their UH, their sales and their behavior and how the consumer likes their product, and that's how we release our change for the next year. So we're really listening to the marketplace. It's a market what's what's the turnover, like how many people are repeat vendors and how many people are fresh faces. We have turnover every year,

sometimes not because of the products. Sometimes people move on, they get they get larger. UM the Body Shop, which became a major international change, UM had a stall a canden Lock in London in the nineteen seventies. Um she started with a table selling potions. She came from the Midlands, but that was their first London outlets. Sou Saban, which is a pretty big retailer now started with with with stalls and some of the markets, so some of them

grow out of it. That's amazing. I mentioned, um your background having worked with the urban space in London, and I read recently that you were looking at Chicago and the West coast. How big do you think the concept of food halls and gift fares can get nationally? Where can this go? Certainly can go further? How much? I

don't have the answer to. There's gonna be a lot of it coming because we're not the only ones going into Chicago, going to other cities, so it's gonna be interesting to see who are your competitors, Oh, you know, anything from other restaurateurs that are doing multiple these concepts, or landlords who are putting things in their buildings. So it's really coming from multiple directions. So there's a building.

I want to say it's thirty eighth and Broadway. Since you brought this up, and the interesting thing they did with the ground floor is every real estate tenant is a fairly hip new restaurant. I can't say I've ever seen that before. It's a relatively new building. I don't know if you're familiar with that that area, Is that the sort of concept that that might we might see more of. Are those potential competitors out there or there's

something that you do. Sure, we would not normally just put a bunch of retailers on a street like that, because we're more interested in the community aspect of what a food hall is. And I think that's one of the compelling things about food halls, is that the interaction between all the various people all in one place at one time. You know, they I think since two at least people have been talking about locals the new luxury, food is the new fashion, and everyone the buzzword is authenticity.

You know, we've been dealing with authenticity since the seventies. And we started this because we were always working with local small businesses. UM. For many years we couldn't we weren't considered a major tenant by landlords because they were looking for national credit. Now everyone's looking for authenticity, So you know that the tide has changed. Suddenly, it's inverted,

it's it's different than it was. So so speaking of the beginning of nineteen seventies, UM, the person who founded Every Space in London in nineteen seventy was Eric Reynolds, who sort of used the catchphrase lighter, quicker, cheaper um. Is that still the watchword? And is that how you approach setting up a new space? And does the economy

itself make a difference in how you operate? Is the economy only makes a difference if humors are buying our products, So we're not as impacted by interest rates or other fluctuations. We're just, you know, we're interested in our people buying our product. I mean, outside of the Great Recession when things were horrific, the economy gets better, it gets what

a little worse? Are you guys? Fairly recession proof short of a near depression in UM in two thousand and eight when things were a little rough, I was hiding under my desk along with everyone else, and we had a holiday market at Union Square to put on, so, uh, you know, we came out and it turns out people came out of the woodwork. They wanted to be in the parks, they wanted to be outside, they wanted to

be with other people. And that's when we first really started to think in that people are looking for human experience, like an authentic experience, and our sales were up so from your sales were up in two eight. Yes, that's astonishing, but we weren't selling items for selling items, so the thought processes and they're staying away from expensive stores and going to the fairs where they can still find something a little unique and interesting but much more reasonably priced,

and looking for experience and connection. And I think that's one of the things that we're able to offer very very different than a retail store experiences when you're actually interacting with not just a vendor, but the entrepreneur who may be the designer or the builder of whatever that

particular good he is that's being sold. Yeah. Yeah, And that's a little bit of where the letter cricker cheaper comes from, is that, you know, we're setting up the rough space, um, but we're looking to the vendor to really brand themselves within the parameters of what we give them. So that's you know, people ask us how you can do these things in about four or five days as long it takes us to put these out, and it's because it's you know, many hands to make small work. Right.

So a previous guest was Dan Biederman. He was the person who helped design Brian Square Park in an number of other public private projects, and one of the things that stood out from that conversation was he else programming was the key to making a space successful, that you had to bring people in, you had to give them

something to do. And it reminds me a little bit of what you're describing, which is the community space, the interaction, the experience, not just buying a sandwich or buying a widget, but the whole overall experience. Is that a fair statement? Sure? I mean what what Dan did with Brian Park was amazing from where that started years ago, right for people who may not be familiar, Brian Park was right west

of the New York Public Library. It was a den of iniquity, of drug sales and muggings and just terrible. And it's now one of the great jewels of Manhattan. It really is, and it's actually become a great food area as well. Um. So I think that making public spaces better is very clearly adds to value in and what's happening around those spaces. So I think programming is part of that. So one of the questions I wanted to get to before UM had to do with UM

in Paris and in London. I've seen them the gift fares as a permanent not just to pop up UM location, and I read also Tokyo they're a permanent holiday fairs, not temporary holiday affairs. Is that sort of experiences that? Can that work in New York? And can that work in the United States? Or is that a little more continental than the American palette my we have for example, candid Lock, which was an urban space project, is a

year round marketplace UM. I think it's hard to set those things up because to get the density and an urban center to do that at a real estate value that makes sense. I haven't seen it very often, so that's one of the reasons why I've done it. Do any plans on trying that in the US? Or is that really best left to the Europeans? I think it's it's not where the trend is right now? Well, where is the trend? What? What do you see as the next offshoot? It's all food for us, It's it's food.

It's primarily food. Why is that is food the new entertainment? Is that because it's it's something that people need every day and it's a way to bring people together in a communal experience, and it's a way to connect really creative young businesses UM with consumers in a way that's more exciting than things that they've had in the past. So I have to ask you about urban space itself. Um, when you started in ninety New York, how many people were working with you here in in in the United States?

Over year one was just a couple of people, right, And what have you expanded to? How many people are in urban Space today? We're probably in the head office and and what's the relationship with the original London office is that still ongoing? Oh yeah, partners. Eric serves on

our board and has an interest in our company. So we talk a lot about trends that are happening in London, trends that are happening in New York and in you know, compared notes, so which really you know, I know, how fashion trends move Paris, Milan, New York and then eventually makes its way west. What direction our food trends going. I was just in the West Loop of Chicago and I was struck by how much it reminded me of Brooklyn.

Um not what I expected to see and UM and for people who may not be familiar with that part of Chicago, this was rail tracks and was to die for a long time until I want to say sometime in the mid nineties, maybe it was Oprah Winfrey set up um Harpo Studios there, which is our production company, and that started in renaissance there and now it's just full blown. It reminds me of Hudson Jord's UM here in New York. It's just not cranes everywhere, lots and

lots of buildings. Is a big Google office there. What direction do food trends move? Are you seeing this go from you're all to hear vice versa all directions? It's kind of it's kind of crazy. I think that it's something that's bubbling up UM globally. You know. I was speaking with UM, the head of the World Food Street Street Food Congress, just last week, and we think we have a lot of food halls going on here, well in in in Asia and in Singapore. It's it's much

beyond what we have here. And this is something that that is global and that's really more of a cultural tradition. Their food stalls and that sort of public communal eating experience seems to be have a much longer history than we have in the United States. It does, but you you still have, uh i'd say, more chef driven concepts even within those contexts, kind of growing up out of out of the of those street markets. Really that that

that's quite fastenathing. We have been speaking with Eldon Scott of Urban Space. Be sure and check out my daily column. You can find that on Bloomberg View dot com. Follow me on Twitter at rid Holts. We love your comments, feedback and suggestions right to us at m IB podcast at Bloomberg dot net. I'm Barry Ridholts. You're listening to Master's in Business on Bloomberg Radio. Welcome to the podcast, Eldon, Thank you so much for doing this. I am a

huge fan of what you guys do. And one day I was online at Delaney Chicken and looking around, and I said, somebody has to be behind this. This sort of thing doesn't just spring up fully developed on its own. And I started doing a little bit of research and eventually reached out to Urban Space, and and here we are. I have to ask you a couple of questions about your career because a lot of the folks I speak

to have followed a very specific career path. They went to college, they went for an m b A, they got a job at a big firm, and then they went to a boutique and then they launched the run shop. There's a fairly clear path. I think what you did is fairly unique. There aren't all that many holiday fair slash food halls around, so there can't be that many businesses doing this, and therefore there can't be that many

people with your career path. When when you first accepted the gig, did you realize you were taking such a non traditional career path in in real estate and urban planning. I was young enough so I didn't realize what career I was giving up. I just thought it was exciting.

I wanted to do it, and my background was really more urban planning architecture with some real estate, so to me it was a new brainer to get involved with Camdon Locke, which was which was a very exciting place to be and what was the business like in London? Had I know that over the forty so years since the launch they've done fifty pretty substantial projects. When you joined, were they a thriving successful company? The UK have gone through a series of economic expansions and ran into some

trouble in the seventies. They got a little better in the eighties, um, and then the nineties everybody exploded. What was it like back then? Was it any bit of an issue? You joined them when? Late eighties? Is that right? Uh? No? The early nineties, Okay, I guess it was late eighties. Trying to remember. Yeah, it was like eighties, eight eighty nine. Um, no, it was. It was a thriving business. It was. It was you know, if you've ever been to London, you

went to Canon Candon Locke. Especially back then. It was you know, even more energetic back then. So it was an exciting place to be. And I really got a kind of traditional apprenticeship, uh in a business. So you know I was out there collecting twenty pound notes from fenders, moving stalls around, you know, doing the business from the ground up. So this was really hands on sort of career from from from the start. It was hands on

and you know, what you gain is experience. And I think what experiences is seeing patterns, um and what you see if you do something over and over again, because you see, well, if you line up the stalls this way, the sales are gonna be better if you line them up that way. So we learned our own little rules about retail facing retail. How many stalls can you sustain for a market? How much traffic do you need? And really it was just a body of experience that I

gained by doing markets now for thirty five years. So no, you're just hit or miss, trying a bunch of things and then iterating with each subsequent UM. Fair to say, here's what we learned with the last one, and slowly but surely it just gets more and more robust. You you learned. That's why it was like an apprenticeship. You learn almost like a craftsperson learns their trade, and you start to understand what the internal rules are of that business.

And that's what we've learned about. Any really unique UM experiences stand out, anything that was well, didn't expect that to happen. You can say. One of the interesting things is the quality of the vendors, both chefs and and craftsman has just skyrocketed. UM. So back when I first started doing this in New York in the nineties and early two thousand's, UM, look, there were a lot of there were a lot of great vendors and people making food.

But sometime around two eight, when the you know, the Internet and social media was really kicking in and other potential career paths we're looking a little less successful. Um, we suddenly started to see a lot more interesting chefs. You know that the food truck thing was was blowing up.

People were off publishing, they were tweeting where they were on a certain corner, and suddenly you had people who might otherwise have been, you know, trying to develop software or get a job in finance, we're saying, hey, you know, I can make a really interesting brand. I can make

a food business. And that's actually only continued to get stronger because as you've seen things like shake shacko Public, you've had more private equity firms jump into the space and more opportunity for young people to to create a brand and and and and roll that out. So you alluded to something I have to ask, how significant to the food halls are social media Instagram, Twitter? How big are various people's followings and do they drive traffic to

different vendors? Yeah? I think I don't think there's any business that's not touched by social media, and I think that the food halls certainly grown up, the new new version of the food halls grown up with social media. So a lot of consumer now are you know, looking online, Where's where's our food? All wars there the most interesting chicken sandwich and they're finding it online. I read something that certain food companies are changing the packaging of their

boxes so they're more Instagram friendly. It's gone that far. Uh do we see vendors making dishes pretty bright, colorful, whatever it is, so that they're more susceptible to a quick snap and neither a tweet or well, you know, fast casual is by nature very instagram morble. So why

why is that? Because you you get, you get a plate, you can take a shot on your table, you've got colors, you've got different food and if if there's a story behind that, and it's not just a national chain sandwich, Um, that's something that can be inherent in that, in that Instagram or in that Facebook. So you know, people loved it. I think food is one of the most highly instagram items. Yeah,

no doubt about it. So you mentioned earlier narrative, Um, how significant is the narrative process to different food vendors and and different holiday fair uh craftsmen as well. We think it's it's a huge part of it really. We think explained that that that's kind of fascinating. Well, you know you're going to a market or a place like this too, I feel like you're experiencing something that's part

of the city or part of that community. So even if you don't know all the details of each of these stories, you get a sense that there are real people here with real life stories that have brought this product to it to you. And these aren't just corporate drones working flipping burgers. These are real chefs and real craftspeople. Well, the control that the main control decisions are very localized.

So it's that entrepreneur has decided they're going to sell you know, green sandals or whatever they decide to sell. We're not deciding that. So I think that a consumer sense is that they're not being sold something from on high. This is the result of many individuals making many decisions. Quite interesting. I think that that for us, what we really look for is to create a sense of community, um, and we do that by bringing uh, real live entrepreneurs

together and real consumers. And that community and authenticity is inherent in bringing those communities together in a great space. Makes a lot of sense to make. So let me jump to my favorite questions. These are what I ask all of our guests, um tell us the most important thing people don't know about your background that I'm an

urban planner? Is that true? Probably? Interesting? Who are some of your early mentors, Esoteric Lee Christopher Alexander, who is an interesting architect and planner who wrote a book called a Pattern Language, and he really thought about urban spaces as a series of vignettes or patterns that get put together into a language. And what's interesting about it is that a lot of his thinking was was picked up by software engineers in Silicon Valley in the seventies and eighties.

So there's an interesting tie in between what's happening with our perception of urban spaces and what's happening with the idea of frames in Instagram or a Facebook and how things are organized. What other architects, urban planners, real estate developers influenced your approach to thinking about food hales or holiday affairs. The Rouse Company, you know what, the Festival Marketplace, which really came around the time at the Boston Tennial.

I was a kid at the time. I grew up in Boston, so I'd take the training and I got a I got a Fannial Hall. I'd read the Boston Globe Real Estate section, and I got excited about the idea of markets in the idea of reusing buildings. Probably

at that time. I've noticed that whenever there's a form of um urban renewal, and probably the broadest version of this I've seen recently has been in Portland's These buildings that were once used for one specific set of purposes have now been There were mills, they were mining, smelters and things like that. Suddenly they become these very hip retailers and restaurants. Is that what you're referring to when

you talk about repurposing. I think there was an earlier phase of market repurposing that started in the seventies that you know, the Rass Company was a leader in that. You Camden Locke started at that time. I went to a markets conference a couple of years ago at Pike's Place, and actually Pike's Place was renovated and repurposed in this in the mid seventies. Is that what we're talking about Seattle, and we had um Eric from London, the guys from

Pike's Place, we had other guy from South Africa. And it was interesting talking to people who had been involved at that time redeveloping things. And it was very real estate driven. It was like, we got this great warehouse, let's reuse it. Today it's different. I think that what's happening today is it's very vender driven. It's about the entrepreneur. The space is critical, but it's first and foremost about the creativity and the idea of who the vendor is.

And we have many more great vendors than we did back then in the seventies. So everybody's favorite question. Tell us about some of your favorite books, be they real estate, food, architecture related or not. What what are you reading? What do you like? Um? I read. I read a lot of history, you know, I'm fascinated with the history of cities.

I read a lot about about London, about New York, about other about other great cities and how they developed, and the economies of these cities and how the economy is interwoven with um how these places have been set up.

Give us a few book titles. Oh, I love the you know the biography of the Wright brothers, and you know, if you read the first chapter of that, you know the Right brothers were bicycle repair people, but they were working in a vibrant city in the nineteenth century where you had, you know, a lot of entrepreneurs and a lot of access to parts and pieces and ideas and a lot of idea of there's no limitation to what they could do, and the individual entrepreneur or inventor could

really put things together and make something new happen. And I think what's really exciting to me working in the sectors that I see that energy. I see it in Brooklyn, now I see it in Boston and Chicago. There's a lot of young entrepreneurs who feel empowered by the Internet and by the technology to go out and create something quite quite interesting. So, so since you started working in this space, what has changed? How is it different today

than it was in the early nineties. What's different today is technology has changed everything. Therefore, the consumer preference or what consumers are looking for has shifted quite a bit. So there's much more interest, which I didn't anticipate what happened in markets and in entrepreneurs. So that's exciting. I would Well, that leads me to my next question, Um, what is it that you're most excited about right now?

Beyond technology which is changing everything, what really drives me and I in a lot of our company is creating great places that are social places. So we're not hopefully always going to be stuck in our car or home looking at our computers. That we can create great places where you can be out and leading a civic life, if you will, meeting other people, brushing shoulders, meeting entrepreneurs. And I think that's a big part of our mission. Tell us about a time you failed and what you

learned from the experience. Oh, I've had plenty of bad markets, and I think markets that have filled and I think that that's something that currently a lot of our is jumping in don't have the experience of knowing that these markets just don't work everywhere, and you know they go bad, they go bad fast because you don't have a national tenant who's signed a tenure. Least, you've got a local guy, and that they're leaving the second they're not making money,

they're walking out the door. So this does not work everywhere. And I think a good fifty percent of what's being planned right now won't last in the long run really, so so there is no long ramp up if this these don't come out of the gate working, they have a what is it a ninety day window before people say, you know, it takes it takes a good year because

everyone's got great intentions and they're working hard. But you know a lot of we we've worked with um a group that that that works with small businesses, and they've done surveys. A lot of these small businesses don't even know if they're profitable. They don't have the books, the bookkeeping, or they're not on top enough of what's going on. So it may take them a year to realize that

this isn't working for them. Really, that's amazing. I would think if they're not profitable, they're writing a check to cover it, you would think they would be aware where unless they have capital with another they're living day to day and they're as long as they're able to pay a bill they're hoping for the sales went increase, So so a new market opens up and it's more or less got a year to catch on or else. So

what happens vendors start to leave. When do you make the decision, Hey, this isn't working, We're gonna pull the plug when the vendors leave. So it becomes an easy at the point, Right, how often does that happen? What? What's your success rate? Like, you know, early on, I'd say two thirds okay, but even still a third failing is a pretty Uh that's a pretty big number. And

now much less because now we're much more cautious. You're more cautious, or you just more experienced than knowing what works and what does in or some combination experienced and cautious. We you know, we get inquiries almost daily and we say no, no percent of the time from the space or from the vendors or who's who's making the inquiries. Um, landlords, Hey, we'd love to set up an urban space here. Yeah, and so I look at a place like Vanderbilt. That's

got to be a fairly long term lease. I assume, right, this isn't a pop up. This is there for a while. Um, you have lots of other spaces that people approach you about like that. Yeah, I mean, look, there's a retail is soft. There's a lot of people looking for for tenants. Um Ton of empty storefronts, even even Manhattan, which is robust and thriving, lots of lots of empty spaces. Yeah, and there's gonna be a little bit of price adjustment,

you know, rents will adjust a little bit. There's other downward, you know. I think that I talked to a lot of people. I think there'll be other tenants backfilling those spaces. But clearly it's a It's a great market to be in if you have a a concept that's making money right now, right and um so, how many more urban space type food halls can Manhattan's support you can open? We're opening, definitely opening more in Manhattan. You know, we

think our trade area is fairly fairly tight. All right, So you're a going to guess you're sticking to Midtown and downtown by the financial district and maybe Hudson Yards. Is that, uh, we're looking at those places, yeah, and others. I would assume is it driven more by the office worker or is it driven by I look at the Upper east Side or the Upper west Side. You have a lot of residences and not as many offices. Can can an urban space work in an area like that?

Or do you need the crush of that lunchtime rush. There's a lot of different customer bases, so it could. It can be residential, it can be tourism, it can be office. Obviously there's different patterns to each one of those. Sure, so tell us what you do outside of the office for fun when you're not thinking about architecture and urban planning. What do you do to relax or kickback. I do a lot of ski trips with my kids, and we

do a lot of stuff together as a family. So we're skiing, we're playing tennis, were hiking and doing Tuckerman's Ravine next month. Where is tucking about Washington? Oh, so that's a that's a serious well for the East Coast. What advice would you give to a recent college graduate or a millennial who was considering working in retail architecture or urban planning or any of those sort of work that you do, and they were looking for a little

guns what would you tell them? Definitely, just jump in, you get a job, get some experience, um, and start start doing it. I think that you need the experience. I think if you tried to start, for example, a food brand too early without knowing all the ins and outs, it could be difficult. On the other hand, if your capital etta isn't that high, you'll gain exp is by doing it, even if the first one doesn't work. And our final question, what do you know about urban planning?

Rest you touring holiday fairs food halls today that you wish you knew twenty plus years ago when you were first getting started. What would have been helpful twenty years ago to know that today you just take for granted. I think what is easier today probably didn't exist twenty years ago, which is, you know, access to landlords in capital But that's that's just shifted m so to one more about capital markets in real estate than than I did when I started. But it was it was it

was tougher to find spaces years ago. That's that's that's quite interesting. We have been speaking with Eldin Scott of Urban Space. If you enjoy this conversation, be sure and look up and enter down an Inch on Apple iTunes or overcast wherever your final podcasts are sold, and you could see any of our other two hundred plus such conversations. We love your comments, feedback and suggestions right to us at m IB podcast at Bloomberg dot net. I would be remiss if I did not thank our crack staff

who helps put together the podcast each week. Medina Parwana is our audio engineer. Slash producer Taylor Riggs is my booker producer Michael bat Nick is our head of research. I'm Barry Ritults. You've been listening to Masters in Business on Bloomberg Radio