Rolling Stone to launch restaurant chain in L.A.
http://www.latimes.com/business/la-fi-rolling-stone4-2009dec04,0,4958990.story
The magazine steps into a tough industry next summer with a
two-tiered location at Hollywood & Highland Center.
By Roger Vincent
December 4, 2009
Rolling Stone is about to take a leap into the entertainment
industry, starting with a large-scale restaurant and nightclub in Hollywood.
Owners of the venerable magazine hope to leverage its status as a
preeminent chronicler of the rock music world and pop culture into a
new business built on food and drinks. The first Rolling Stone
outpost is set to open next summer at Hollywood & Highland Center.
"We've been looking for the ideal opportunity to expand the Rolling
Stone brand," co-founder and Editor Jann S. Wenner said.
Running a high-profile entertainment-themed restaurant chain has
proved perilous for others, however. Competitors such as Planet
Hollywood and Hard Rock Cafe have taken embarrassing financial
thrashings in the past, though both continue to operate.
Hard Rock, in fact, plans to open a large restaurant and bar of its
own at Hollywood & Highland in May. Rolling Stone's joint will be
smaller but fancier and, well, hipper, its creators insist.
"The food will be higher-end than Hard Rock," said Niall Donnelly, a
partner of the magazine. "The venue itself will be for higher-end audiences."
Rolling Stone tapped Donnelly and his partner Joe Altounian, a real
estate developer, to do the heavy lifting involved in building an
establishment intended to appeal to both tourists and the chic
celebrity set of young Hollywood.
Donnelly, an amiable Irishman who happens to have a skull tattooed on
his forearm and prefers whiskey (Jameson, not Bushmills) to beer, has
built a track record as an operator of upscale trendy clubs in
Britain and Ireland.
The Rolling Stone venue in Hollywood will operate on two tiers,
Donnelly said. On the top level, which opens into the mall, will be a
restaurant and bar intended to appeal to the estimated 15 million
tourists a year who come to the Hollywood intersection near Grauman's
Chinese Theatre. He also hopes to pull in local residents who may
come to watch sports or have a drink.
At street level, on Highland Avenue, will be a more up-market lounge
"which will be harder to get into," Donnelly said. Like other
late-night Hollywood lounges, it will include "bottle service," where
patrons buy their spirits such as vodka by the bottle -- usually at
hefty prices. The lounge may also be rented for corporate events.
Despite the magazine's long marriage with the music industry,
Hollywood's Rolling Stone will not be in the concert business.
"We will have live music from time to time for record launches or
parties," Donnelly said. "Otherwise we'll have a live deejay."
Rolling Stone also won't compete with Hard Rock and Planet Hollywood
in the memorabilia-heavy decor department, opting instead for what
Donnelly hopes will be a timeless interior of exposed black brick,
tufted leather and an antique iron staircase.
"We don't want it to be a museum," he said. "We won't have Elvis
costumes on the walls."
The menu will be a mix of traditional American fare and California
cuisine, he said, "and we'll have some Mexican-inspired stuff."
The migration of Rolling Stone's name onto a restaurant represents a
significant and perhaps unsettling cultural shift, at least to baby
boomers who remember its early years in the late 1960s and '70s when
the magazine offered a thumb in the eye of mainstream society with
its earthy language and pioneering of take-no-prisoners "gonzo"
journalism as practiced by reporter Hunter S. Thompson.
The magazine still has its bite. In July, writer Matt Taibbi served
up a line that was instantly repeated in other media when he referred
to Wall Street bank Goldman Sachs as "a great vampire squid wrapped
around the face of humanity, relentlessly jamming its blood funnel
into anything that smells like money."
But Publisher William Schenck says Rolling Stone's brand is strong
enough to capitalize on enterprises beyond the magazine. The company
already has branched into books and released its first video game
earlier this year.
"It seemed logical and organic to break into a restaurant," he said.
"It really made sense to us."
Schenck denied that the punishing financial atmosphere for print
publications pushed Rolling Stone into the restaurant business. "In
any economic climate we are going to try to find every avenue to
increase revenue," he said.
After 42 years, Rolling Stone is still an authority on popular
culture, Schenck said, and half its readers are under 30. The
Hollywood venue is intended to capture the irreverence of its covers,
such as recent fronts with singer Lady Gaga apparently dressed only
in bubbles and teen actor Taylor Lautner in a wet T-shirt.
"We aren't going to have political debates," Schenck said.
But breaking into the crowded food-service business is no picnic,
said stock analyst Conrad Lyon of Global Hunter Securities in Newport Beach.
"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."
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