The pandemic has disrupted the food business across the U.S. but less so for bakeries than restaurants. But there’s also opportunity there. Take Angelina’s Bakery in New York City.
Once there were two Angelina’s Bakery in Manhattan, one in Hell’s Kitchen and the other near Central Park. Owner Tony Park shuttered the one near Central Park but has kept the Hell’s Kitchen outlet open.
But he’s opening three new Angelina’s Bakery in 2021, as the city continues rebounding from the pandemic. His new outposts will be located in Times Square, Herald Square, near Macy’s, and trendy Williamsburg in Brooklyn.
He identified areas that were busy, have plenty of office workers, and attract tourists, whom he expects to be returning in droves.
Park, a New Yorker since 1998, expresses confidence in the city bouncing back from the pandemic. “I’ve seen New York go through 9/11 and the Lehman Brothers break-up. New York City will come back,” he exclaims.
“Now you can get real estate at better prices than before,” he said.
Park is capitalizing the three new bakeries with private money combined with bank loans. However, if he starts franchising in the future, he’ll tap private equity funding.
Park could be called a hyphenate because he’s a baker, chef, and runs a boutique brokerage firm PD Properties. He’s the rare baker/chef/real-estate broker.
He’s arranged his finances so that he can survive for a year and a half, without having to turn a profit. He’s negotiated special deals with landlords for reduced rent and concessions that he could never have secured pre-pandemic.
“I’m hoping to break even by end of the year, make a little profit by next summer and then start turning a profit,” he reveals.
The landlord on the Central Park site, which is only six blocks or so from his new Times Square location, was inflexible about making concessions, forcing him to relocate.
He expects that many office workers will come back, and “they want to eat grab and go and that’s where my bakeries fit in.”
Park is of Korean descent but was raised in Palermo, Italy by an Italian family. He studied pastry in Palermo, served as a pastry chef, moved to New York City where he managed several Italian eateries, and then developed a commercial real-estate business.
What also enabled him to expand Angelina’s Bakery (named after his daughter) was its thriving wholesale business. It sells to supermarkets and restaurants, which constitutes about 30% of its overall revenue compared to 70% for retail.
Angelina’s Bakery is known for its bombolone, an Italian donut, consisting of Bavarian cream, with reduced amounts of sugar and butter. But it also sells a bevy of other items including pizza, focaccia, and sandwiches that are a combination panini and ciabatta bread, and desserts such as tiramisu. He also trademarked Brissant, a cross between a brioche and croissant.
Park says the target audience that dines at Angelina’s Bakery consists of a “young crowd, Instagram people, plenty of tourists in Times Square including Europeans.”
The new Times Square location, which expects to open in August, is sizable, encompassing 4,000 square feet. It accommodates 60 people inside and 60 outside on a plaza. His previous Central Park outpost was only 600 square feet.
Unlike most restaurants these days, off-premises sales at Angelina’s are modest. Delivery and pick-up generate only 5% to 10% of revenue.
As a broker, he has also arranged leases for many of the Paris Baguette franchises in the city, which helped him learn what works and what doesn’t in bakery cafés. That franchise kept its leases down to $20,000 or less a month, which enabled it to stay profitable.
Maison Kayser, a French bakery café, signed leases for up to $40,000 a month, thought its brand would carry it to success, and eventually overbuilt. overpaid and folded.
Angelina’s Bakery is already filing its documents to get franchising off the ground soon. He says its bakery concept is simple, easily duplicated, and employees can be trained in a day or two on how to make the sandwiches and breads.
Park says the keys to the future success and expansion of Angelina’s Bakery are: 1) finding the right locations, 2) attracting franchisees in the future who have $300,000 to $400,000 to invest and want to work hard, 3) luck, that the pandemic continues to fade away.