Hospitality empire grapples with pandemic
Landry’s Inc., Tilman Fertitta’s global hospitality company, had a banner year in 2019, completing several restaurant acquisitions, including a more than $300 million deal for high-end steakhouse chain Del Frisco’s.
But when the novel coronavirus hit this spring, Fertitta was forced to shut down every dining room and kitchen in Landry’s portfolio of more than 600 restaurants and furlough tens of thousands of employees for at least two months. Fertitta, who turned a single seafood restaurant in Katy into a multibillion-dollar hospitality empire, said it was the most painful thing he’s had to do.
As states have restarted their economies, Landry’s has reopened about 80 percent of its restaurants and brought back about 90 percent of its furloughed employees, but it is still operating businesses at less than full capacity. Some states, such as California and New Jersey, only allow outdoor dining, while Texas allows restaurants to operate at 50 percent capacity.
“We’re doing OK, but not great because of social distancing,” Fertitta said. “But we’re going to do whatever it takes. It’s more important to social distance than to worry about the economic side.”
Landry’s ranks No. 4 on this year’s Chronicle 100 list of the region’s largest private companies, based on revenue of $4.6 billion in 2019, up from $4.3 billion in 2018. The Houston company employs 58,000 nationally, including 11,900 in the Houston area.
Fertitta, who has advised Gov. Greg Abbott and President Donald Trump on reopening the economy, said he’s concerned about the spike in coronavirus cases, but does not think the economy reopened too quickly.
“We’re looking at all Texans to be social distancing and wearing masks,” he said, “because that’s what we all need to do to get through this.”
Fertitta said he believes the nation faces a long recovery as consumer confidence has taken a hit and slowed spending. Face masks, gloves and other safety measures are adding about 10 percent to his restaurants’ costs, but those costs won’t be passed onto customers.
“We’re prepared for the worst,” Fertitta said. “We have to be safe.”