Melbourne CBD eateries close as Rockpool freezes payments to suppliers

COVID-19 claims its first victims from the ranks of Australia’s seriously wounded restaurant industry.

Teage Ezard is shutting his two CBD restaurants, Ezard and Gingerboy, as a direct result of the massive downturn in restaurant dining. Picture: Rebecca Michael

COVID-19 has claimed its first victims from the ranks of Australia’s seriously-wounded restaurant industry.

Well-known Melbourne chef and restaurateur Teage Ezard is shutting his two CBD restaurants, Ezard and Gingerboy, as a direct result of the massive downturn in restaurant dining. They will both shut Saturday night.

Ezard, an up-market dining room in Flinders Lane, has been open 21 years; Gingerboy, in Crossley Lane, is nearly 15 years old.

Ezard told The Australian both are losing too much money to continue.

“Ironically, February was a pretty good month, but we can’t go on. The last thing I want to be doing on a Thursday afternoon is telling staff they don’t have a job to come back to on Monday morning.”

The news emerged as the Rockpool Dining Group restaurant chain told suppliers it needs to suspend payments for at least two weeks due to its exposure to the impact of COVID-19 on trade and a plummeting of general patronage.

Chef and restaurateur Neil Perry, who remains the face of the business, said the company was under significant financial strain from a combination of fewer customers, social distancing, general panic, and restrictive measures imposed by various governments.

Restaurateur Neil Perry at his Rockpool Bar and Grill in Sydney. Picture: Jane Dempster

The restaurant chain employs about 3,000 people across 80 venues, including Rockpool Bar & Grill, Sake Restaurant and Bar, and Fratelli Fresh.

Ezard said the CBD in Melbourne has been decimated by the coronavirus.

“We’re not just losing money, we’re going backwards fast,” he said “everyone is”.

A number of major restaurant industry employers have laid off casual staff already to try and stem the haemorrhage of money from their businesses; they include Melbourne-based Andrew McConnell’s group and the pan-city Lucas Group behind the Chin Chin restaurants.

One industry player, who asked not to be identified, said he expected the hit to business as a result of the virus to “wipe out at least 30 per cent of Australia’s restaurants, probably more.

“So many operators are hand-to-mouth. Even if they stay open to try and trade through, the downturn will break their backs,” he said.

The operator had just laid off 70 staff today to accomodate the downturn.

In Brisbane, one of the city’s hottest restaurants of 2019 has also closed permanently, directly blaming the virus downturn in business.

In a statement issued on Thursday, the management of Howard Smith Wjarves said: “It is with much regret that we announce ARC Dining has had to close its doors. The effects of COVID-19 are having a significant negative impact on many businesses in the industry, and we’re devastated ARC Dining is a casualty of this situation.”

Rockpool Dining Group suppliers have been told the impact of diminished patronage had been significant, and that lobbying of the Federal Government was continuing for a hospitality bailout package.

Michael Campbell, the Dining Group’s Chief Financial Officer, has written to suppliers asking for future trading terms to be extended by two weeks and for existing accounts to be given two weeks of credit.

“It’s tough. We’re all trying to preserve cash and employees and it’s just what needs to happen when you have a once in a century occurrence,” Mr Perry said, referring to the impact of COVID-19 on the global economy.

Patronage has fallen at Rockpool Bar & Grill. Picture: Rockpool

“All the restaurants are trying to stay open, trying to comply with various things the governments are bringing in, and they’re understanding – but (the measures) are tough.”

Mr Perry, a brand ambassador for the company, announced in March that he would take back control of seven premium restaurants controlled by Rockpool Dining Group, which formed out of a merger in 2016 of Mr Perry’s Rockpool Group and Urban Purveyor Group, then the largest restaurant and dining group in the country.

He said some of the larger, spacious restaurants in the company’s portfolio were better placed to comply with social distancing measures, such as leaving 1.5 metres of space between tables. Smaller venues, however, were finding this requirement more challenging, he said.

The cap on gatherings of more than 100 people had also had an impact, he said, though some restaurants would count themselves as lucky to attract that many customers in the present climate.

“For everybody’s sake we need to keep calm. It’s not just the restaurant industry, it’s every industry. We’re trying to make safe spaces for our customers – I’m in the city, I’m not quaking with fear at every moment because I’m scared of getting coronavirus.”

Rockpool Dining Group issued a statement on Wednesday saying it was taking all practical steps to comply with social distancing edicts. The majority of its restaurants remain open for business.

“Each venue will maintain a strict customer headcount, and this will be rigorously monitored,” the statement said. “At some venues we have reduced opening hours and consolidated menus. We will assist staff and guests to practice social distancing where practical.”

Mr Perry said suppliers had been compassionate about the request.

“I think most of the people who we’re involved with understand,” he said.

A Rockpool Dining Group spokeswoman said suppliers were being worked with on a case-by-case basis.

“We, like everyone else in the industry, are working closely with suppliers to manage through this once-in-a-lifetime crisis. We have written to suppliers requesting their support and an extension of trading terms by 14 days on future and existing accounts.”