Food Writer Weighs In On What's Contributing To Restaurant Closures In Metro

The high cost of doing business - including rising prices for ingredients, supplies, and leases - may be contributing to a recent rash of restaurant closures in the Metro, said a food writer who has been closely covering the industry.

On Tuesday, Ned's Starlite Lounge in Oklahoma City announced on Facebook it was permanently closed. The post did not specify a reason. News 9 reached out to the business but did not get a response.

The closure of Ned's Starlite Lounge came after several other restaurants in Oklahoma City shuttered in recent months, including Scratch Paseo, Louie's Grill & Bar, The Eleanor, and The Mantel Wine Bar & Bistro.

Greg Horton, who has been a food writer for various publications since 2007, said he has been keeping track of the closures. "It feels like I've announced six in the last three days, and there was of course that spate in Midtown where there were four within a couple of weeks. So it's been somewhere, 15 to 20 for sure, in the last three to four months," said Horton.

Horton said although each restaurant had its own reasons for shutting down, high costs have been hard on the industry and may have contributed to some of the decisions. "Restaurants operate on a net profit margin of about 3 to 5%," said Horton. "And with the volatility of costs, food and non-food items are up somewhere between single digits and quadruple digits."

Non-food items include cleaning supplies, to-go containers, and plasticware, among others.

Horton added that high-interest rates also make it difficult to build restaurants and leasing prices can run $26 to $43 per square foot. Despite the rising expenses, Horton said if restaurant operators get a bit of assistance and the market trends upward during the second quarter of 2024, there may be light on the horizon. "Part of it is just getting costs under control, whether that is legislative answers to what clearly is price gouging at this point, or people eating less in your Chili's and your Red Lobsters and all your chain restaurants," said Horton. "Why are we sending money to headquarters in other states because you're eating at these large chains when you could be eating locally with people who will know your first name within a few visits?"

A study done by Keep It Local and Oklahoma's Credit Union said 66% of money spent at local restaurants recirculated back into their communities, compared to 30% spent at national chains.