Divine Bar East Says Goodbye - A Bad Day For Wine, A Good Day For Duane Reade

Shari Schneider and Michael Vitanza quit their jobs twelve years ago to open Divine Bar East (244 East 51st Street, between 2nd and 3rd Avenues, NYC 10022; 212.319.WINE), a Zagat Survey Top 20 rated restaurant nightspot, and one of the foremost wine and tapas bar concepts in the city. Sadly, they will be closing the doors of their original Divine Bar location on March 29, 2008, while continuing to operate their West side outpost, Divine Bar West (236 West 54th Street, between Broadway and 8th Avenue, NYC 10019; 212.265.WINE). Why, one might ask? Simply because their landlord wanted to more than double their current rent in order to renew their lease.

"I want our loyal customers to know that we are closing down because of an outrageous rent increase, not because Divine Bar lost popularity," Schneider says. "If people knew what it cost to run a restaurant in NY these days, they would be inspired to drink more not only to help cover astronomical costs, but to soften the shock and disbelief."

"The public needs to know what's going on out there. When they wonder and even complain about paying $7 for a Heineken, it's because they don't realize that the ambience they're enjoying has a $4,000 monthly Con Ed bill, and a $20,000 monthly rent," adds Vitanza.

Despite the last few years of political, economic, and social upheaval, commercial rents in Manhattan have escalated greatly in a time where consumer spending is down and business expenses across the board have gone up. Among the rising costs of plastic (petroleum) and paper products, as well as anything associated with shipping and fuel costs, such as food and wine, the biggest problem is still being able to pay the high rents.

"This is a threat facing the entire restaurant industry; certain spaces are zoned for restaurant use, but landlords are not calculating, nor caring, that the rent they want is impossible for a restaurant to actually generate. At some point, despite any genius in marketing or cost cutting, a restaurant will hit its ceiling of sales. You can only pack in so many bodies and turnover seats so many times in a night. But there doesn't seem to be any ceiling on the escalating commercial rents of Manhattan. When that happens, restaurateurs either end up literally working for the landlord, or shutting down their business," laments Schneider.

She adds, "The saddest part of this is actually bigger than the loss of Divine Bar East. Good people will have lost their jobs; a neighborhood loses its character; a couple loses their favorite hangout of the week or the place where their marriage proposal took place. Each time excessive rents force a premature closing, a little piece of the city dies, but based on what is really 'unnatural selection.' Ultimately, all the creative people who conjure up these wondrous food and beverage concepts are beaten down. Who would want to own a business in that kind of environment? I do believe landlords deserve the right to make money too, but not at the cost of every entrepreneur's chance to profit, or even just survive."

Although they are busy running Divine Bar West, Schneider and Vitanza have been thinking of possible remedies. "There needs to be a mechanism from the city or Community Board (CB) to audit or somehow regulate commercial rents in the same fashion as residential apartments," explains Vitanza. "Urban development and planning should be more grass roots; right now, it takes a goliath corporate entity to change the content and image of a neighborhood, such as Disney's transformation of 42nd Street. But a CB needs to be able to protect the small business person from being squeezed out because of unchecked rent hikes."

In 2008 alone, Zagat has repo