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Why Havasu doesn’t have an Olive Garden

September 9, 2018

While it might be nice to see an Olive Garden open in Lake Havasu City, it won’t happen anytime soon. Same goes for Red Lobster, Cracker Barrel and many other popular chain restaurants

Havasu’s demographics and isolated geographic setting just don’t align with the minimum qualifications set by the corporations.

“The long and the short of it is they have very specific criteria as to what they believe will make them successful,” said Lake Havasu City Mayor Mark Nexsen. He said Olive Garden once seriously considered opening a Havasu location, but didn’t follow through with development.

“Olive Garden has actually talked about coming here on multiple occasions and, on one occasion, actually dropped plans off for approval and then backed out,” he said. “It had everything to do with their corporate financial situation.

Corporate owner Darden Restaurant requires a trade area of at least 100,000 people and an average daily traffic count of 20,000. The company also has strict requirements for site locations and contract terms and specifications regarding how the restaurant is designed.

This is not uncommon for major chains, according to Partnership for Economic Development Executive Director James Gray. He declined to comment further on the matter.

The proximity of major highways also play a big role in a company’s decision to move to the area, according to Nexsen. Interstates can be a big draw. That’s why a city like Kingman – much smaller than Havasu with a population of about 30,000 – can attract restaurants like Cracker Barrel.

Still, demographics haven’t stopped new restaurants — most of them mom-and-pop joints — from opening in Havasu. New additions in recent months to Havasu’s restaurant scene include Four Clovers, Shotgun Jenny’s and Dunkin’ Donuts.

Lake Havasu City Councilwoman Michele Lin, who owns Lin’s Little China Restaurant, said the city’s employment numbers can also be a factor in a decision whether to open a franchise here.

“If you’re a bigger company coming in, you’re going to have to fill that business with employees and the employee pool here is suffering a little bit,” she said, adding that her business also has difficulty finding employees. “And it could be suffering for a lot of things; we don’t have affordable housing so you’ve got to fill some of these minimum wage jobs but where are these people going to live?”

Havasu’s jobless rate was at 5.2 percent in May, an almost one point reduction from last June. Businesses have reported that the city’s lowering employment rate has limited its pool of employable people, making it difficult to fill open positions

According to Nexsen, the city has charged the Partnership for Economic Development to attract major chains to the area. He says the PED has “made every effort to do that,” but Lin thinks there’s room for improvement.

“I honestly think that is kind of their job, that they should be helping the city to bring everyone in (and) to be honest, I think we’ve been neglecting that for a while,” she said. “I don’t think that they’ve been held accountable for helping bring those businesses in,” she said. “I don’t know if the city itself should be out there recruiting a Costco, I think that’s what we have a PED for and that’s why they receive money from our city government, our city taxpayers, to do just that.”

According to the city’s June 2018 sales tax report, the city collected more than $2.2 million in restaurant and bar and hotel/motel taxes for the fiscal year to date. A quarter of those taxes are disbursed to the Partnership for Economic Development – approximately $550,000 – while the remainder is disbursed to the Convention and Visitors Bureau, according to the report.

Meanwhile, the owners of the Shugrues Restaurant and Brewery Group are pushing back against a persistent rumor that the company has kept chain restaurants out of the area.

“That’s certainly not the case, not even a little bit,” said Thom Felke, managing partner at Shugrues.

“It’s just kind of silly that people would think that a little family-owned restaurant group would have the power to do that,” added owner Tim Shugrue. “We welcome any competition, it’s good for our town.”

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