Smashburger owner to open full-service restaurant concept
As Smashburger brings its “better burger” brand into the Los Angeles market for the first time this week, the chain’s private-equity owner Consumer Capital Partners is also expanding its restaurant concept portfolio in Colorado.
Tom Ryan, Smashburger’s founder and chief concept officer, was in the Los Angeles area Tuesday for the opening of a Smashburger in Thousand Oaks, Calif., in southeastern Ventura County. It is the chain’s 163rd location and the first of 40 to 60 planned for the greater L.A. area over the next five to seven years — about half of which will be company owned.
The Smashburger chain, which celebrated its fifth anniversary last month, is expected to reach 200 locations before the end of 2012, Ryan said. The chain has a pipeline of about 500 units over the next several years.
Meanwhile, back in Denver, where Consumer Capital Partners is based, the company is preparing to launch a new full-service concept called Tom’s Urban 24, a “modern diner” that will be open 24 hours and will offer contemporary comfort food, “but not blue plate specials,” said Ryan, a managing partner with the investment firm.
Scheduled to debut in September on Denver’s Larimer Square, Tom’s Urban 24 will have a full bar, and Ryan pledged that it will be “the first of its kind.” However, whether or not it’s a concept that will grow remains to be seen, he noted. “Right now, we’re focused on getting the concept right."
Tom’s Urban 24 will be the second new concept by Consumer Capital Partners to debut in the past year. Last October, the group founded Tossa Pizza in Boulder, Colo., a pizza, pasta, salad and wine concept that is fast casual by day and full service at night. The company is planning to open a second location of Tossa in Denver later this year, Ryan said. Growth beyond that has yet to be determined.
Consumer Capital Partners was founded by Richard Schaden and his son Rick Schaden, cofounders of Quiznos, which was sold in a debt-for-equity swap early this year that allowed the sandwich chain to avoid bankruptcy.
Smashburger, meanwhile, has become the growth vehicle for the investment and concept-development firm, expanding rapidly with both corporate and franchise restaurants despite an increasingly competitive “better burger” landscape.
Known for its burgers that are literally smashed onto a 400-degree flat-top grill, a process said to sear in juices, Smashburger has an average check of about $8 to $9, and sales are split fairly evenly between lunch and dinner, Ryan said.
In addition to the core menu of burgers, grilled or crispy chicken sandwiches, garlic-and-rosemary seasoned fries and Häagen-Dazs shakes, Smashburger is also known for offering regionally specific menu items in each market. In Los Angeles, for example, units will feature an LA Burger reflecting pan-Asian flavors that appear across the city’s dining scene, from food trucks to white-tablecloth restaurants, Ryan said.
The LA Burger is topped with a fried egg, crispy wontons, lettuce and tomato, fresh cilantro and cucumber slices with a Japanese ginger dressing on a bun sprinkled with both black and white sesame seeds, which, Ryan said, “gives it a very cool, distinctive look.” Also unique to Los Angeles will be a chai-flavored milkshake, another nod to the city’s pan-Asian preferences, he said.
Los Angeles locations will also feature a Caribbean chicken sandwich, and a salad with mango, pineapple and papaya salsa that's also available in Miami; Ryan said the flavors would also work well in Southern California. In addition, LA units will also feature a Fresh Mex Burger developed for Smashburger in San Diego — a version served on a telera roll and topped with avocado, onions, pepper jack cheese, lettuce, tomato, sour cream, fresh cilantro and chipotle mayo with a wedge of lime on the side.
Ryan predicted Smashburger will do well in Los Angeles, a city already stuffed with local better-burger brands, from the cult-worshipped In-N-Out Burger chain to Umami Burger, Habit Burger Grill, and Burger Lounge.
Smashburger’s archrival Five Guys Burgers and Fries, based in Lorton, Va., has also been growing in Southern California, but Ryan said he’s not worried. “We compete with those brands in more than just California,” he said.
“Burgers are America’s favorite food and Smashburger is a highly differentiated brand. We’re not just competing burger to burger, but also on service, atmosphere, menu variety and price points,” he said. “There’s enough room, I think, for a lot of growth in this whole category.”