Blue Sage to close as Portland restaurants big and small struggle
by Ted Sickinger, The Oregonian  Friday July 03, 2009
http://www.oregonlive.com/business/index.ssf/2009/07/big_and_small_restaurants_i\
n_t.html
Stephanie Yao Long/The OregonianThe Blue Sage in West Linn is one of the latest
Portland-area restaurants to call it quits in the continuing recession. The two
Blue Sage locations, by the owners of the Old Spaghetti Factory chain, opened
just before the economy tanked with a new concept that combined walk-up ordering
with upscale southwestern ambiance and cuisine.
Like a Fourth of July hot dog bursting open over too-hot coals, the Portland
area's restaurant scene -- only recently ballyhooed as among the nation's most
vibrant -- continues to shrivel amid a scorching recession.
Gone in recent months are old standbys such as McCormick and Schmick's in Old
Town as well as newer, but once-hot spots, such as Fife, Cava and the Alberta
Street Oyster Bar and Grill.
That's only a small sampler of the closures, each of which comes with a unique
side dish of circumstances. But in an industry of thinly capitalized operators
that often survive dinner to dinner, shift to shift, the common ingredient is
the economy and the price it is exacting on diners' spending habits.
The latest to fall is the Blue Sage Cafe, a trendy concept from a veteran set of
Portland restaurateurs, The Dussin Group.
Dussin is best known for its low-priced pasta restaurants -- the Old Spaghetti
Factory -- which have weathered the storm better than most due to their
affordable offerings and loyal clientele, said Chris Dussin, the company's
president.
Yet Dussin has already had a full helping of the downturn with Lucier, the
multi-million dollar South Waterfront extravaganza that became the most
spectacular flameout in the pantheon of Portland eateries when it closed in
December after about seven months in business.
Blue Sage Cafe was at the other end of the dining spectrum, a concept that
combined the walk-up ordering of fast food with an upscale southwestern ambiance
and cuisine.
When the original cafe opened in a West Linn mall in March 2008, "fast-casual"
dining was a rapidly expanding sector, and Dussin had visions of transforming
his groundbreaking concept into a national chain.
The cowhide, saddle and Pendleton blanket decor, not to mention the sweet potato
fries and barbecued chicken, were well received by patrons in West Linn and Lake
Oswego, according to online restaurant reviews. But as a business, it never
really caught on.
At this point, Dussin says it's hard to get a pulse on whether the concept
failed or got sucked into the economic undertow. The restaurants experimented
with full table service and even offered a name-your-price promotion this spring
that let customers decide on the price of their appetizers and entrees.
"I don't think it ever really got a fair shot because people changed their
spending habits in this economy," Dussin said Friday. "It became obvious as we
got into the late spring that people's habits weren't changing enough to keep
the thing viable."
The two locations in Lake Oswego and West Linn employed about 90. Many employees
have been absorbed into the company's other restaurants, which also include
Fenouil, an upscale bistro in the Pearl District, Dussin said.
Lucier and Blue Sage are exceptions in Portland. Most restaurants don't have the
same deep-pocketed owners, and the economy means that customers are looking for
better prices while suppliers are demanding cash on delivery.
Local restaurateurs are still digging out of the extended December snowstorm
that came on the heels of a stock market swoon and crushed the industry's
crucial holiday season.
"Most people are surprised that more places haven't closed," said Bruce Carey,
owner of Saucebox, 23Hoyt, Bluehour and Clarklewis. "It still feels like there
could be more contraction coming."
While the recession has claimed few of the long-standing, or critically
acclaimed, restaurants in the city, almost every eatery has been forced to
adjust to an increasingly pennywise clientele by emphasizing happy hour, putting
more middle-brow items on high-priced menus, or issuing coupons.
Carey added lunch at Clarklewis and 23Hoyt to bring in customers who want a fine
dining experience at a lower price than a full dinner out.
At 23Hoyt, he put on the menu more economical bar fare, such as burgers,
bratwurst and fish and chips. He installed televisions above the bar and
expanded the selection of beers.
"Business is down 20 percent overall from the same time last year," Carey said.
"But we're seeing stabilizing numbers at this point."
David Machado, owner of the neighborhood restaurants Lauro and Vindalho, is one
of the few who has managed to expand during the recession. He recently opened a
downtown restaurant called Nel Centro in the newly refurbished Modera Hotel.
"That's a risk I took because it had some built-in margins of safety: 174 rooms
above me, proximity to the arts, and proximity to the downtown business
community," said Machado, who also enjoys a favorable lease at the new location.
"So far it's been a good opening."
For all of its posturing as a national or international food destination,
Machado said, Portland doesn't have a big business market driven by conventions
or international travelers.
"When Portland erodes, we erode our own home-grown base," he said. "We don't
have that second layer of business that most large cities have access to."
Machado's prognosis for the rest of 2009 is that the closures will continue and
even accelerate through the summer.
His patrons' No. 1 question these days is whether his restaurants have a happy
hour. Diners aren't looking for a bowl full of chicken wings and half-price
margaritas, Machado said, but an assurance that food and beverages have been
significantly discounted.
"We're in a deflationary environment. ... That pressure just permeates the
entire industry right now," he said. "It's omnipresent."
Ted Sickinger; tedsickinger@...
 




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