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The company formerly known as Conran Restaurants has just been renamed D&D London, signalling its new management and fresh approach. The men at the top, Des Gunewardena and David Loewi, tell Gaby Huddart what the future holds for the group
The Des and Dave show is well and truly up and running. Following their acquisition of a 49 per cent stake in Conran Restaurants last September – in conjunction with Bank of Scotland Corporate and 40 of their managers – Des Gunewardena and David Loewi have firmly put their mark on the company, renaming it D&D London at the beginning of March.
It’s a move that has shocked many in the business world, and the restaurant trade in particular. Conran Restaurants had become a household name in the UK and for many restaurant-goers, it conjured up images of stylish eateries staffed by elegant waiters serving beautifully presented posh nosh.
But, explain Gunewardena and Loewi – chairman and managing director of the company, respectively – they felt it was important to give the company a name signalling its renaissance.
‘This is a really important point in the development of the business. It’s been very successful in the 1990s, but there’s been a significant change in its management and we thought it was the right thing to do to acknowledge that,’ says Gunewardena.
‘We felt Conran Restaurants had become something of a brand name and we want to move away from that feeling. The restaurants are all individual and we want to make more of that.’
Loewi adds: ‘We really feel this change is right for the long-term philosophy of the company and our plans for developing the restaurants. Changing the name is an opportunity to show there’s a new energy in the company and that we’re making a fresh start.’
One wonders what Sir Terence must think of the change – surely he must be a little aggrieved not to have his surname on the company he founded and in which he still has a 51 per cent stake.
Not so, says Gunewardena, who has kept up a close relationship with Sir Terence, with whom he has worked
since 1989. Sir Terence was more than ready to hand over the reins of the company’s management, he stresses.
Indeed, the idea for the buyout was Sir Terence’s (see panel, below). He is happy to leave Gunewardena and Loewi to the task of running it as they see fit, the one proviso being that they use Sir Terence’s design company, Conran & Partners, to handle the design of any new projects or restaurant refurbishments.
‘My relationship with Terence is such that we talk regularly – at least once a week – about what we’re looking at doing,’ says Gunewardena. ‘We don’t need his advice or opinion before taking a decision, but he’s involved in the sense that he’ll ring if he sees a great property that he thinks we should look at.’
‘And he still gives me feedback on the restaurants,’ Loewi adds. ‘His principal role is through Conran & Partners on the design, but we’ll have conversations about what he thinks if he’s been into one of the restaurants.’
It has been well documented that Sir Terence was adamantly opposed to floating his restaurant on the stock market, having had a turbulent time as chairman of Storehouse PLC in the late 1980s. Indeed, he once told me: ‘I don’t think this business lends itself to a stock market listing. It’s such a visible thing – every lunch and dinner is like a public performance. To have a bunch of analysts snooping around all the time saying “the portions are too big” or “you weren’t very busy at lunchtime” would be intolerable.’
When I ask whether this position remains unchanged under the new regime, Gunewardena grins: this is the question a lot of journalists have been asking him recently.
He indicates a slight softening in the company’s stance. ‘There’s a great freedom in being a private company in that you can do what you want to do and move quickly. If you go public, you can’t manage the business in the same way,’ he says.
‘That said, occasionally you can be a successful restaurant company and float. Our aim is to always act in the interests of operating quality restaurants so, potentially, who knows what we might do in future? We are not completely ruling out flotation, but we are not actively looking at it either. Most people seem to think we are, but we are not.’
So, if there’s no schmoozing in the City going on, what’s the key focus for D&D London in the months ahead?
Gunewardena says he and Loewi have set themselves the ambitious target of doubling the company’s turnover within three years and they are stepping up several gears in terms of its rate of expansion.
Since they have taken over the helm, D&D London has opened three restaurants in Copenhagen (see pictures, below) and, as we go to press, two restaurants are on the point of launching in Japan.
‘We’ve looked for a long time in Tokyo to develop a restaurant business, but had to find the right partner over there – someone dedicated to building a big business,’ says Gunewardena.
A partner has emerged in the shape of Japanese restaurant company Hiramatsu, which will own the two new restaurants but pay D&D London a turnover-based royalty.
‘We are developing the concepts, design and menus and they will run the business. David will go over a few times a year to give operational input and Max Renzland, our food development director, will also go out several times a year to keep the food as it should be,’ says Gunewardena.
Back home, a new restaurant, Skylon, is scheduled to open at the newly refurbished Royal Festival Hall on the South Bank in June.
‘This will be similar in structure to Plateau in Docklands,’ says Loewi, ‘with a bar and grill on one side and a more fine-dining restaurant on the other.’ But he stresses: ‘The look and feel of the place will, of course, be completely individual.’
Thereafter, we can look forward to more openings in the UK and overseas. Gunewardena says he would like more eateries in London. ‘And in the next five years, we’ll also do more around the UK than we’ve done in the past five years,’ he adds.
Manchester, Glasgow and Edinburgh are particularly attractive locations for the company, although openings here will depend on appropriate sites coming onto the market at the right price.
Similarly, overseas expansion will depend on the availability of good sites. However, Gunewardena reveals that he’s keen to open another operation in New York, while he sees Madrid, Barcelona, Rome, Shanghai and Hong Kong as ‘logical places where we’d like to open’.
‘If we do open somewhere abroad, the key thing is that we’ll do it in a big way. Just as Alcazar in Paris is 12,000sq ft and
Custom House in Copenhagen is 13,000sq ft, we want to do similarly interesting, large-scale projects,’ Gunewardena explains.
Loewi adds: ‘Operationally, we can’t be spread all over the world randomly because we’d be spread too thinly. Rather than peppering the world with restaurants, we are more interested in having restaurants in fewer cities, but building significant businesses there. It’s much easier to manage them that way.’
But it’s not only restaurants that D&D want to open. Hotel projects are also being considered. Gunewardena and Loewi were involved in the development of the Great Eastern Hotel in the 1990s and installing several eateries there. The property – which Conran owned in partnership with Blackstone Real Estate – was subsequently sold last spring, netting Conran Restaurants £33.2m.
‘We’re never going to be a Hilton, but we are attracted to interesting buildings we can turn into good hotels and put restaurants into,’ says Gunewardena. ‘We had fantastic success with the Great Eastern, so we’d be very happy to do something on similar lines, though we are looking at small hotels as well as large ones.
‘It’s very difficult to find sensibly priced property – either an existing hotel we can revamp or something we can convert – but I would like to have a property secured by this time next year.’
Whatever they end up buying, there is little doubt that this dynamic duo faces exciting – and very busy – times ahead.
The 49-year-old chairman of D&D London was born in Sri Lanka and came to the UK at the age of seven, when his father, a civil engineer, came here to work.
He went to Bristol University and then trained as an accountant with Ernst & Young, after which he had a spell working for property group Heron International.
Sir Terence Conran recruited Gunewardena as his finance director in 1989 and he went on to become chief executive of Conran Holdings. He still remains on the board of Conran Holdings as deputy chairman, in addition to his role at D&D London.
Gunewardena lives in Wimbledon with his wife and their two children.
The 48-year-old managing director of D&D London has spent more than 25 years on the London hospitality scene.
He took a post-graduate course at a hotel school in Switzerland, joining the Savoy Group on his return home. This was followed by a stint with Hyatt, where he became food and beverage director of the Hyatt Carlton Tower.
Loewi joined Conran Restaurants in 1995 to launch Mezzo and was promoted to managing director in 1998.
He briefly left the company to work with Jeremy King and Christopher Corbin setting up The Wolseley and researching hotel projects, before rejoining Conran as managing director in 2004.
The genesis of the sell-out of a 49 per cent of Conran Restaurants to Des Gunewardena, David Loewi, 40 of their managers and financier Bank of Scotland Corporate came from Sir Terence Conran himself.
Gunewardena says that about four years ago, Sir Terence suggested that Gunewardena – then chief executive of Conran Holdings – might like to buy into the restaurant business. ‘He said that because he was getting older, why didn’t I get some backing and buy the restaurant business and Conran Holdings would retain the retail business.’
Gunewardena continues: ‘Talking it through with Terence, we both felt there was lots of potential for growth in the restaurant business and that giving it an independent life would allow it to do this.
‘Obviously, translating that casual conversation into reality took a long time, but that’s when it started.’
Gunewardena says he didn’t hold the usual beauty parade of financiers when he was looking for backers as he already had contacts at HBOS, which owns Bank of Scotland Corporate. ‘They’d always said if I ever wanted to do something, they’d be interested. So when the time came, I simply picked up the phone to them.’
Ultimately, the deal that was done in September last year saw Conran Restaurants valued at £50m. Gunewardena, Loewi and several of their head office executives, restaurant managers and head chefs bought a 31 per cent stake between them, while HBOS bought 18 per cent and committed a further £10m to fund new ventures.
Conran Holdings retained 51 per cent of the restaurant company, while relinquishing its management. Gunewardena succeeded Sir Terence as chairman of the restaurant business and Loewi remained in the role of managing director.
La Casa del Habano
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Editorial Feature from Square Meal Lifestyle Magazine Spring 2007