Q&A Mark Grossich

Mark Grossich has had many careers.  He ran a chain of newspapers.  He ran a modeling agency.  An ad agency, a PR company.  The list goes on and on.

But what brought this restaurateur the most success and satisfaction is the number of upscale cocktail lounges, cigar bars and restaurants he has opened over the years, including the trend-setting Campbell Apartment at Grand Central, The World Bar, The Carnegie Club, Bookmarks, Madison & Nine and Dag’s.  He’s inordinately proud that the cocktail and dining spots are some of the most popular and trendy places to socialize and, oh, yes, eat.

How did you get started?

We had a client in my advertising and PR business who was a hospitality guy and he approached me on whether I would be interested in going into the bar business.  So we opened a place down in the West Village on Hudson Street. I still remember the address, 636.  He wanted to call it Hudson Bar, and I’m like, Hudson Bar, what, are you kidding me? Every marketing instinct inside of me said, no way.  But we came up with the notion, Hudson Bar and Books, a library-themed place for late-night guests and they are still open. So that’s how it all started.  We had four or five Bar and Books operations going, and I decided I wanted to go in a different direction, and we parted ways.  But I guess I go back even farther than that in the restaurant world. My heritage includes a family that was in the business, and one of my first jobs as a kid at 14 was scrubbing pots and pans at the restaurant!  I learned about hard work and the challenges of the business, and certainly, the importance of hospitality, to be successful in the restaurant business or any other.

How does Hospitality Holdings fit into things?

It’s really the management company that oversees all of our individual properties. Surprisingly, the name was available. And I’ve always enjoyed it. It has a ring of being listed on the stock exchange to some degree I think.

What was your first stand-alone project?

The Campbell Apartment and The World Bar in the Trump World Tower.

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You’re one of the few operators who’s succeeded in a very eclectic group of venues. Cocktail lounges, historical venues. What’s been the key to that success?

We started off with the notion of upscale cocktail lounges.  If you remember, years back, restaurants suddenly became very large and very much the place to go. Lounges really took a backseat to that. So we brought that back. We had a strict dress code that was also part of that whole world. Basically, we were bridging the gap between public space and private club. Then, as our business continued to grow, opportunities presented themselves, which tugged us in one direction or another, which led to having instead of just upscale cocktail lounges, restaurants now. We have outdoor spaces. We have government spaces. We have rooftop spaces.

But what I’m seeing in the marketplace today is bars pushing harder and harder to create more than the old bowls of nuts, and eggs, and whatever else used to be on a bar. Now we’re coming out of real kitchens that really rivals going to a restaurant for a full meal.

And is the idea that that keeps people drinking?

Absolutely.  It’s moving a little bit more from just finger foods to complicated and exciting foods for people to truly substitute restaurant dining for.  And it makes sense because restaurants are all looking desperately for ways to expand their lounge business, and that’s certainly one way.  At the same time, we’re increasing our profitability.

Now you have to hire a kitchen staff.

Ideally, we look for people that have both food and beverage.  Our vice president, group general manager, Kenneth McClure, is a graduate of the CIA. He has the added benefit of being a very talented hospitality person to boot, too.

What are the marching orders that you have given him relative to hiring a culinary staff, relative to what the role of a chef is versus a cook?

He’s not the chef per se.  He oversees the operation.  We have kitchen folks for that. And our marching orders?  To do the best we can and be aware of food trends.  We have the advantage now of having two full-service restaurants, which gives us the opportunity to really show our hand with food.

Are you in the people business, or the real estate business?

Well, that depends on whether you consider landlords people.  We’re certainly in both but it doesn’t help to have a lot of great people if you don’t have the space for any of them to go. But it all starts with finding a great space, and then that’s followed by weighing that space against what your realities are. For example, obviously there are a lot of great spaces way off the beaten track that are far more inexpensive. But if you miss, you could be out-of-pocket a significant amount of money.  To truly be successful you’ve got to develop a destination place, like many of our places are.

Where does your vision come from?  Where do you get inspiration?

All the above, including reading publications like yours.  You look at somebody’s situation, and  you go, how did they come up with that? The name, the look, the concept.  Our basic positioning has always been our tag line, which is simply “New York’s most refreshingly civilized places to meet.”

And that continues to guide us. You know, we stay on the high road.  Our ideal clientele are a little older.  We’re not a trend.  We stay as far away from trends as possible.  It’s an acknowledgment that the trend is going to end at some point.  And ours are timeless. The proof of the pudding for us is the sheer amount of time we’ve been able to sustain our business. The Carnegie Club is 15 years old. The Campbell Apartment is 16 years old.  Madison and Vine is eight years old. My senior staff has been with me for years.  You need all of it. If you’re lucky enough to find it, as I did, it makes all the difference in the world. It makes it a joy to do business.

Do you think that combination of a soft economy and somebody like you, who knows what he’s doing, was your recipe for success?

People drink when things are bad.  So we’re a little recession-proof in that regard.  But that being said, it’s a very competitive marketplace, particularly in New York City.  And unfortunately, the nature of competition often means price point, too.  You’ve got a lot of situations where the larger operators may take ridiculous reductions to try to get an edge, to drive business over other competitors.

And let’s not ever overlook that little thing called luck. You do your best to try to address all the variables, and you can’t control everything.  You’re hoping you get somebody to pat you on the head with a little gold dust.

Cocktail menus have changed over the years.  Is it still about a great martini?  A great Manhattan?

Yeah, and that’s also fundamental to our long-standing positioning.  We watched the whole craft cocktail craze come and go and come back again. We find it kind of amusing at times. There’s a reason traditional drinks have been around so long.
Certainly we tip our hat to the craft cocktails that are oh-so-popular at the moment.  And we’ll have a few of those on our menu. But the simple truth is, if you’re looking to make money in this business, developing cocktails with six, seven, eight ingredients that take five minutes to make, makes it very difficult to do a volume business.

So, was food, when you began, an afterthought, or a secondary piece of what you were doing?

The thought about food was, get them to drink more by giving them stuff with salt. Or whatever will make their palate desperate – the mentality that you have with a cocktail, which is to continue to serve the classics and the basics.

Is that the same mentality and the same strategy you use as you approach food? Or do you need to take a different approach to what you do with food?
No. We actually try to balance the two.  We’ll certainly keep the cocktails in mind when we create the menu but our staff is more than capable of discussing the food and offering cocktails or wine to go with your choice of a meal.

What about your approach to vendors?  On the wine and spirit side, a lot of these folks have been calling on you for years.

We have terrific relationships with all of them. It’s very simple to have a good relationship with vendors. Make sure you pay what you owe.  We have great vendor relationships. They’re very supportive of us. We do a lot of events together, which is great.

And so, what about the food side?  Are you there yet?

I’m afraid not to the same degree.  We’re just not doing the same volume, but we hope to.  In food you do have an opportunity to go to bid more often.  You have a different slant.  We have our own little mini-Shake Shack in the park next to the United Nations. For example, there we have a real strong relationship with Pat La Frieda, who makes a very good burger and also makes us custom hot dogs.

Tell me a little about how the Lexington, the Falls, and the Gramercy deals came to fruition.

Well historically, I built the business, as you know, brick by brick, dollar by dollar, out of my own pocket.  We got to a nice place and had some really terrific properties. We’ve got a wonderful portfolio and  try to accelerate our growth, which is exactly what we did this past summer. We also had a couple of opportunities that helped, like our restaurants.  Gramercy Park, I had my eye on for years. I kind of casually knew the owner. I called out of the blue at the beginning of the year and said, Hey, listen. Is your place for sale? Fast forward about six months and he wanted to make some adjustments to his focus and get some money for the house and go in another direction.  So we happened to be there and boom. And I’m proud to say that it’s already rockin’ and rollin’.