Burned soufflés!
Rash of eatery disasters strikes NYC
An accident plague of biblical proportions is wreaking havoc on New York City restaurants — and owners have learned the hard way that insurance coverage can only do so much.
In the first six months of 2018, physical calamities shuttered an unprecedented number of high-profile Manhattan eateries with more than 1,500 seats in total.
But even when a restaurant is able to reopen after a prolonged shutdown, it might have lost customers whose dining habits changed over time.
The latest victim was The Dead Rabbit on Water Street downtown — voted No. 1 in 2015 and 2016 on the Londonbased World’s Best Bar list. A ventilation-system fire and resulting water damage closed the place on July 1; fortunately, it will reopen on July 19.
But neither legendary, 100 year-old Angelo’s of Mulberry Street nor Midtown’s Da Noi has reopened after blazes earlier this year. Other fires sidelined Michael Jordan’s Steak House at Grand Central Terminal and Shelly Fireman’s Redeye Grill on Seventh Avenue; both will soon reopen after being closed for months.
Water damage from burst pipes last January, blamed on a bitter winter freeze, forced the five-month closing of the fabled 21 Club. Although its main-floor dining room and bar reopened in May, its upstairs private rooms are out of action until September. An internal water leak also led to a twomonth winter closing of modern Greek eatery Ousia on West 57th Street.
Maybe the saddest loss was Bistro Chat Noir on East 66th Street, a neighborhood institution, which owner Suzanne Latapie was forced to close when a gas leak not in the café, but elsewhere in the building, caused Con Ed to shut the gas indefinitely. Gas issues also felled Raymi, a large modern Peruvian place on West 24th Street.
Neil Owens, an insurance broker who specializes in restaurants, said, “With an event like Hurricane Sandy, you expect to see a large number of closings. But this year’s number of closings without a single major storm is unusual.”
Insurance policies, “when properly written,” Owens said, help pay for repairs and cover payroll costs during a shutdown so that owners can keep their staffs from leaving. Another broker, Myles Share of MSA Insurance Group, said that a restaurant typically pays 1 percent to 1.5 percent of its annual revenue for a “basket” of policies that covers replacement costs and business interruption — although most of the policies are devoted to liability for such things as customer food-and-alcohol poisoning and labor matters.
A strong policy helped save first-class steak house Michael Jordan. A fire broke out on Feb. 8 “where a kitchen hood connects with the chimney,” said co-owner Peter Glazier. He said his Admiral Indemnity policy is covering more then $300,000 in kitchen repairs and $20,000 in weekly payroll.
Glazier noted that the fire damage was relatively mi- nor. But “50,000 gallons of water the FDNY had to pour into a chimney ruined the kitchen and destroyed our equipment,” he said.
It’s a familiar story. Share noted, “Honestly, water and the FDNY sometimes do more major damage than the fire itself.”
It took months for Michael Jordan to get all the needed approvals for a replacement kitchen from its landlord, the MTA. Glazier hopes to reopen the dining room in a few weeks. (The bar is open.)
Water, not from fire hoses but from an internal leak, shut down Ousia, the beautiful, 170-seat Greek restaurant at 629 W. 57th St., for eight weeks. It proved that risk isn’t confined to century-old structures: Ousia is inside brand-new Via, the Durst Organization’s pyramidal apartment tower on West 57th Street.
In January, a water main broke in a second-floor maintenance closet above the restaurant. “Fortunately, we picked a good insurance plan with Chubb, and Durst was very supportive as well,” said Johnny Livanos, a member of the eatery-owning Livanos family.
Another jumbo eatery, popular, 25-year-old Redeye Grill at 890 Seventh Ave., suffered “a little fire in the kitchen” last April, said owner Shelly Fireman.
He thanked the FDNY but noted, “They had to go behind walls and destroyed our kitchen. Thank God for Chubb and our landlord, Vornado.”
Redeye Grill won’t reopen till November, when it will become three distinct eateries with separate entrances.
A worse fire casualty was old-school Angelo’s of Mul- berry Street, which shuttered in January. “It’s a place for which I have such great nostalgia,” Fireman said. “I was taken there as a kid. It was my first fancy Italian restaurant.” Its fate is unclear as the owners couldn’t be reached.
Sometimes the insurance falls short. After the Jan. 16 gas leak beneath Bistro Chat Noir, owner Latapie believed that her insurer would help.
“But after a 30-day wait they said was for due diligence,” they denied her. The insurer said the policy covered only a “sudden and accidental event” such as a gas explosion — but not what it said was a small leak that went undetected.
It’s a warning to other restaurateurs: Read your policies closely, and pray you never need them.