Scott Barnett & Associates Blog
The Peak: Negotiating a Restaurant Deal at an Iconic Hong Kong Landmark
May 30, 2024
Putting together the deal for a Bubba Gump Shrimp Company restaurant in the iconic Hong Kong landmark and luxury hotel known as The Peak was certainly a - excuse the pun - peak for me professionally.
It all started when I received a call in 2005 from the person in charge of all Peninsula Hotel properties in the United States. They were the premier operator of luxury hotels in the world but, other than staying at their hotel in Manila, I had had no contact with them in our history. This individual explained to me that Peninsula owned the iconic Peak Tower in Hong Kong and they were looking for an American brand as part of their complete remodel of that structure.
As we always did, I responded that it sounded very interesting and would love to hear more about it. I was very attracted to Hong Kong for many reasons and from my first visit many years before. More recently, I had been through it a couple of times on my way to Manila but I really did not know the city. Nevertheless, a few weeks later, my partner, Gordon Miles and I were meeting with Peninsula representatives in Tokyo to discuss the possibility. It seemed they really wanted us.
The Peak in Hong Kong is more than just a major tourist attraction. The view is one of the best in the world and every famous photo of Hong Kong that is seen in travel brochures, magazines or on the internet is typically taken from the Peak. When the British first took Hong Kong in the 19th century, the wealthiest and most powerful Tai-Pans (leaders of the trading houses) located their residences on the Peak- the higher, the more powerful. They still do today though most are now Chinese.
We already had restaurants in development in exotic locations but Hong Kong was something else entirely. This was the city of intrigue, mystery and money. It was an entrepreneur's dream challenge if it could be made to be economically feasible. This truly was a case of putting a restaurant where I wanted to go.
As we always did, I responded that it sounded very interesting and would love to hear more about it. I was very attracted to Hong Kong for many reasons and from my first visit many years before. More recently, I had been through it a couple of times on my way to Manila but I really did not know the city. Nevertheless, a few weeks later, my partner, Gordon Miles and I were meeting with Peninsula representatives in Tokyo to discuss the possibility. It seemed they really wanted us.
The Peak in Hong Kong is more than just a major tourist attraction. The view is one of the best in the world and every famous photo of Hong Kong that is seen in travel brochures, magazines or on the internet is typically taken from the Peak. When the British first took Hong Kong in the 19th century, the wealthiest and most powerful Tai-Pans (leaders of the trading houses) located their residences on the Peak- the higher, the more powerful. They still do today though most are now Chinese.
We already had restaurants in development in exotic locations but Hong Kong was something else entirely. This was the city of intrigue, mystery and money. It was an entrepreneur's dream challenge if it could be made to be economically feasible. This truly was a case of putting a restaurant where I wanted to go.
For most people in business, New York is the center of the universe. For me, it was always Hong Kong.
The Talk of Hong Kong
Gordon and I were again in agreement that it would have to be a joint venture but with who? We did not know anyone in Hong Kong and the only Chinese we knew were the Co's in Manila who were now our Filipino franchisees. They would not want to do it. Or would they? We commenced discussions with them as soon as we detected interest on their part.
We were able to open in October, 2006 to great fanfare. The "Forrest Gump" connection was huge to the media, both in Hong Kong and on the mainland. I was told that several hundred million people saw our Grand Opening in cities on the mainland none of us have ever heard of. Our Forrest Gump lookalike was busy morning to night giving interviews and making appearances. We were the talk of Hong Kong. To a certain degree, the talk of China as well.
Eventually, we would reach and exceed that $6 million budget but Hong Kong's real value to the company lay in its visibility. New York gave us a national presence- and, to a degree, some international as well but Hong Kong put us on the world map. Nobody goes to the city without visiting the Peak at least once. Every international inquiry of real validity from that point on came as a result of Hong Kong. No Hong Kong would have meant no Middle East or Malaysia or London.
We were able to open in October, 2006 to great fanfare. The "Forrest Gump" connection was huge to the media, both in Hong Kong and on the mainland. I was told that several hundred million people saw our Grand Opening in cities on the mainland none of us have ever heard of. Our Forrest Gump lookalike was busy morning to night giving interviews and making appearances. We were the talk of Hong Kong. To a certain degree, the talk of China as well.
Eventually, we would reach and exceed that $6 million budget but Hong Kong's real value to the company lay in its visibility. New York gave us a national presence- and, to a degree, some international as well but Hong Kong put us on the world map. Nobody goes to the city without visiting the Peak at least once. Every international inquiry of real validity from that point on came as a result of Hong Kong. No Hong Kong would have meant no Middle East or Malaysia or London.
Savoring the Victory and the Experience
Some might think it presumptuous or self-indulgent to embark on building a business in Hong Kong and maybe it was. Had it failed, I would have been roundly criticized and deservedly so. Obviously, it did not fail and it became one of the busiest restaurants per square foot that Bubba Gump has. I had not wanted to do a restaurant anywhere as badly as I wanted to do the one in Hong Kong. The city's business history and climate had been immortalized in the books, "Noble House" and "Tai-Pan". The notion that I could someday be there and do that had gripped me for years. I was living a personal dream.
The excitement of that project is difficult to articulate. Every day brought something new and different from our experiences elsewhere. From negotiating a loan with a major Chinese bank to meetings at the China Club to sourcing products upriver in Guangzhou to haggling out the fees with our Chinese consultants; it was the most fascinating year I have ever spent in business.
Lucky does not begin to describe how I felt during that year. As I would take the Star Ferry across the Harbor to pick up the funicular tram to the Peak, I would look around and say to myself, "I have to live every moment of this to the fullest. It will not happen twice."
The excitement of that project is difficult to articulate. Every day brought something new and different from our experiences elsewhere. From negotiating a loan with a major Chinese bank to meetings at the China Club to sourcing products upriver in Guangzhou to haggling out the fees with our Chinese consultants; it was the most fascinating year I have ever spent in business.
Lucky does not begin to describe how I felt during that year. As I would take the Star Ferry across the Harbor to pick up the funicular tram to the Peak, I would look around and say to myself, "I have to live every moment of this to the fullest. It will not happen twice."
