David Aisenstat expands Keg steakhouse chain at the expense of Shore Club and Ki restaurantKeg boss on restaurant sector changes, HST fallout and dark clouds on B.C.’s political horizon
David Aisenstat is one of Vancouver’s best-known hospitality industry entrepreneurs. His restaurant empire generates more than $500 million in annual gross sales.
He owns the 106-location Keg Restaurants Ltd., two Shore Club-branded restaurants, two Ki Modern Japanese + Bar-branded restaurants, Gotham Steakhouse & Cocktail Bar, Hy’s Steakhouse & Cocktail Bar and Joe Fortes Seafood & Chop House.
He closed his Vancouver Shore Club last spring and his Vancouver Ki on December 23.
Aisenstat shared his plans and political concerns recently with Business in Vancouver.
Q: Why did you close the Ki Modern Japanese + Bar?
A: Ki was not wildly successful – although, to be fair, it was only a year and a half old. It isn’t a known brand, which is difficult when you’re not on the street level. There’s a lot of competition for Japanese food, virtually all of which is at a lower price point than Ki. It is similar to how things were at the Shore Club – the average cheque is almost double what it is at the Keg.
Q: What will you do with the Ki’s location?
A: It will become a Keg. It’s a stunning, bigger premises with a lot of outside seating above street level. That’s unusual for downtown. There are few places where you don’t have the traffic and the noise of the street but you have a big patio.
Q: What will you do with the Keg space on Thurlow?
A: Our lease isn’t up, but we will leave a bit early. From the landlord’s [Concord Pacific] standpoint, that works out. I don’t think we would have had much longer there no matter what we wanted to do. They’re doing a renovation of the whole building and will have some very high-end, exciting retail tenants. From their perspective, they’re going to want a restaurant at that location that is part of a very high-end tenant group.
Q: How is business throughout the Keg chain?
A: It’s not back up where it was before the ’08 debacle, but it’s inching its way up there consistently.
Q: Last April, you told BIV that you would open about 10 new restaurants in the next 18 months. How has expansion been going?
A: We’re pretty much on that same target. We’ll have at least two new Kegs in Vancouver in the next little while. The Dunsmuir and Granville Street location will open in April after extensive renovations [costing more than $1 million]. We’re zeroing in on the details, but the one in the [Ki space] will get done by sometime in May.
In November and December, we opened four new Canadian restaurants [Laval, Quebec; Peterborough, Ontario; Bramalea, Ontario; and Calgary, Alberta]. At this point, all expansion is in Canada. We’ve got another one or two in Quebec and maybe three or four in Ontario.
Q: What’s new with the Hy’s Mansion site on Davie Street?
A: We’re looking at a couple of different options. We’ve done a lot of the demolition that we’ve had to do. There are just some issues there. I’m not 100% sure how we want to proceed just yet. I suppose it’s not 100%, but the likely scenario is still to have it be a Keg. We’ll certainly make up our minds and be proceeding on something this year.
Q: You bought Joe Fortes last year. Might you expand that brand?
A: Joe Fortes is a great brand. It’s hard not to be tempted to have more, but who knows?
Q: Do you expect a bump in business once the HST is eliminated and people have to pay a 5% tax on meals rather than 12%?
A: The HST is there for everyone and then it won’t be there for everyone, so it doesn’t really change the playing field much. It won’t be negative, that’s for sure.
Q: Do you have any concerns about provincial liquor laws?
A: Not specifically. I will say that there has been an immensely positive change in B.C. with the Liberals. They have done great things, even just this year. On the minimum wage, would I rather pay less? I might. But the reality is that when [Premier] Christy Clark raised the minimum wage, B.C. had the lowest minimum wage in the country. That’s just not right.
Q: Are you concerned that Adrian Dix and the NDP will win the next election?
A: Yes. I don’t personally know him so I have nothing bad to say about him as a human being. He has a left-wing view of things that I don’t believe will do anything but get our province in trouble. When things were bad, Adrian Dix was there in the thick of things making it all happen. Now, he’s trying to make it look like he’s a moderate, friendly guy. He ain’t. •