Arizona is gaining momentum to become the nation’s fastest growing restaurant market, according to a national report released in the Valley Monday.
The National Restaurant Association’s 2008 Restaurant Industry Forecast predicts sales in Arizona to reach $8.4 billion in 2008, a 6.4 percent jump, placing it only one-tenth of a percentage point behind the No. 1 growth market — Nevada.
Those figures show Arizona to be an ever-growing threat to its northern neighbor’s status as the nation’s premier growth market, said Steve Chucri, president and CEO of the local NRA chapter, the Arizona Restaurant & Hospitality Association.
“When you look at all the ingredients, they turn in our favor to uphold this type of growth,” he said.
Those ingredients are the state’s steady population growth, low unemployment rate and a faster rate of restaurant openings than Nevada.
QUESTION MARKS REMAIN
But Arizona’s degree of growth could be determined by the degree to which employers are affected by the state’s new immigrant employee sanction law and rising minimum wage, Chucri said.
“It really hampers the propensity to have success,” he said, referring to the employee sanction law.
But spirits remain high among restaurateurs.
“We’re very bullish,” said Sam Fox, president and CEO of Scottsdale-based Fox Restaurant Concepts.
Fox — who owns a number of restaurant chains in the state including Olive & Ivy Restaurant & Marketplace, Bloom, North, and Wildflower — has seen double-digit growth for three years.
“We anticipate that as well next year,” he said.
Fox said he’s optimistic that any potential softness in the industry will be offset by other silver linings such the 2008 Super Bowl, which the Valley will host Feb. 3 at University of Phoenix Stadium in Glendale.
‘IT'S PRETTY AMAZING’
Rick Murphy, senior vice present of CB Richard Ellis in Phoenix, a commercial brokerage firm, said local dining options were extremely meager only two decades ago.
Considering that the state is now ranked No. 2 in the nation for growth is an impressive feat.
“It’s pretty amazing,” he said.
He credited the Valley’s rising national profile as a place to live and spend vacations as the biggest reason for the success restaurateurs are enjoying today.
“Phoenix has really become a great restaurant town,” he said.
Darren Tristano, executive vice president of Technomic Inc., a Chicago-based food industry marketing and research company, said while other states will continue to be hindered by negative economic indicators, Arizona is bucking the trend thanks chiefly to its high population growth and tourism industry.
“It’s a very positive outlook for Arizona,” he said.
Eric Jorgensen, a senior vice president with Grubb & Ellis, a commercial brokerage firm, said in a written statement that the growth of new restaurants in Arizona coincides with the rate of retail real estate construction in the Valley.
“With each of these retail centers you can expect anywhere from three to over a dozen new restaurants to open, from fast food to high-end, fine dining,” he said.