London landlords are becoming increasingly nervous about signing restaurants up for long leases following several high-profile closures, according to a leading property expert.

Camilla Topham, director at property consultancy firm Distrkt, said site owners are looking at short-term lets as a means to avoid the negative PR of a restaurant failing.

Speaking at Restaurant magazine and MCA’s recent Generation Next conference, she said: “Landlords have seen a lot of failures in their estates, so there’s a nervousness around new concepts.

“The negative PR of letting a site as a permanent restaurant and having it fail has a big impact. They’d almost rather not re-let that property and leave the site vacant.”

This mentality has led to the launch of short-term incubator project 10 Heddon Street in Mayfair. The site was home to permanent restaurant Magpie until March, when it closed after less than two years of trading.

It has since relaunched as rotating pop-up, housing David Carter and Chris Leach’s pasta concept for three months until last week. It has been reported that it will be replaced by a Japanese concept from Australian chef Shaun Presland in November.

Topham says this model has benefits for both landlords and operators. “Retail is also suffering so this is a way for landlords to offer a different USP and introduce more people to their estate.

Less committment needed

“A lot of restaurant operators are keen to trial stuff without committing. It’s a great way to attract investors, who are a lot more nervous about funding projects that aren’t tried and tested.

“We’ve found there are more people than ever looking to run pop-ups at the moment.”

Carter says the short-term residency has been key to refining his pasta concept and is now looking at longer-term sites. “It’s given us confidence, which you need when you are going to pour the better part of a half a million to a million pounds in to a restaurant,” he says. “Before you do that it’s important to know that you as a partnership and as a concept are ready for it.”

More London sites are likely to be made available on short term leases in the future, according to Topham.

“The street food explosion has meant there are a lot of creative operators on the street that might be looking to move to bricks and mortar.

“The climate is good if you’re a start-up. We will see more restaurants opening and landlords having to be creative, it’s a great time to start a business.”

The full version of this article first appeared on BigHospitality.

Generation Next is a club for the rising stars in hospitality. For information on how to join or the next club events, contact jo.wattar@wrbm.com

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