Red Spice Road in ‘deep hibernation’, Longrain will not reopen
Melbourne’s popular Red Spice Road restaurant has sacked all its workers and will remain closed for at least four months, even after coronavirus restrictions lift. The shock move came shortly after a multimillion-dollar facelift at its new Queen St premises.
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Popular CBD restaurant Red Spice Road has been put into “deep hibernation” with all remaining staff made redundant.
More than 30 full-time staff – a third of whom are on temporary visas – were stood down this week from the 12-year-old restaurant that had recently moved into new premises on Queen St.
More than 70 casuals had already been let go when the coronavirus lockdown first came into effect.
CEO Vanessa Green said it was the $3.2 million cost for the new restaurant that meant the group had limited resources to continue offering pre-prepared and takeaway meals as it had been since late March.
“We went all out to build a beautiful site, but it left us very short on reserves so when COVID-19 hit pretty much a couple of months after, we weren’t able to keep going any longer,” she said.
“We threw everything at it to make it work, but the reality was it was costing us more money to run it and keep it going than we were generating.
“The reason we did that to keep staff employed, to keep everything going a bit longer.
“But every week we remained open, we were losing money. We couldn’t continue.”
Founder Andrew Cameron said the 300-seat restaurant reopening under social distancing restrictions would remain unviable.
“Even if restrictions are eased next week which it looks likely that will happen, those restrictions will be too tight,” he said.
“Our architect has drawn up plans and shows our capacity will be around 35 per cent of old capacity (with 1.5m distance between tables), plus we’ll have added labour costs of registering people to come in, plus (servicing) a large space with fewer people. We just can’t make money out of it.
“The other thing, of course, is our communal dining style, it was very popular before, but isn’t going to come back, people won’t want to go near it.”
He said the restaurant would be put into hibernation until at least September, at which point the situation would be reviewed with a view to reopening in October.
“If that doesn’t work, we’ll talk to the landlord to see if we can put it into hibernation until January or Feb, and then look at it again then. I think it will take that long for it to get back.”
It comes as Melbourne restaurant Longrain announced it would not reopen after being forced shut by the coronavirus crisis.
The eatery announced a temporary closure on March 23, but its 40 staff members were told last week that the CBD stalwart, along with upper-storey bar Longsong, would not return to business.
Owner John Van Haandel told The Australian rent renegotiations had been fruitless, saying “the restaurant industry has been broken for a long time”.
“It was on its knees before this. We asked ourselves: ‘what’s it going to look like, what’s going to happen if we do re-open?’” Mr Van Haandel said.
“We’re a restaurant with eating bars and communal tables. We have a bar upstairs (Longsong) where people gather for drinks.”
He said while trade pre-lockdown had been excellent, profits were thin.
“The last 12 months have been amazing, but everything that yellow isn’t necessarily gold.”
Longrain welcomed diners for 15 years, while Longsong opened in early 2018.
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