David Aisenstat: Rare Breed

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Steakhouses
Image by: Dominic Schaefer

When his British dinner guest handed the menu back to the liveried waiter at Hy’s Encore and ordered chicken cordon bleu instead of one of the iconic restaurant’s famous steaks, David Aisenstat squinted suspiciously across the white linen tablecloth.

Chicken cordon bleu? At Hy’s? It was 1987, and Aisenstat and his father, Hy, had just reluctantly given up their 20-per-cent stake in The Keg restaurant chain with the sale of the steakhouses founded by George Tidball to British brewing company Whitbread PLC for $14 million. Whitbread had dispatched a young Brit named Michael Smith to Vancouver to run its Keg operation, and on this evening Aisenstat had graciously deigned to introduce the Whitbread emissary to a prime cut of Canadian beef. “I thought he was joking. The British, with all due respect, do not make great steaks,” recalls Aisenstat, whose father opened the eponymous steakhouse on Hornby Street in 1962. “The guy comes out here – and I think he must have known that The Keg was the biggest steakhouse chain in the country and Hy’s was sort of a high-end version – and the guy orders f***ing chicken cordon bleu. I thought, ‘OK, this is a bad start.’” Things got Keg-size worse. Whitbread’s man in charge soon went West Coast native, Kitsilano-style. “He became a non-drinking vegetarian,” Aisenstat bristles. The interloping Brit proceeded to renovate the bar areas right out of The Kegs and abandon the menu’s steak-first focus. “Basically it took two or three years of this and people who were big Keg fans – loyal Keggers, myself among them – were starting to get pissed off. And yet they weren’t doing anything good enough to attract new guests, so it started sliding.” Whitbread, perplexed by the plummeting sales of its multimillion-dollar overseas acquisition, decided to conduct some market research. According to Aisenstat, “They spent a million bucks researching this to figure out a Keg should be, ‘Oh, a steakhouse and a bar,’” he says, “which is exactly what they f***ing bought. Go figure. What kind of genius told you that?” When Whitbread eventually decided to refocus on its brewing business and put The Keg up for sale in 1997, Aisenstat asked for the bill. “I was quite surprised because Whitbread wasn’t a company that sold things,” he admits. The $50-million selling price astounded some food-industry pundits who thought it was rich for the chain in its state at the time. But Aisenstat believed the under-performing steakhouse chain represented sizzling value, and he partnered with Sam Belzberg, an old pal of his father’s, and CIBC to come up with the asking price. “His timing was impeccable because beef was just coming back into favour,” says Chris Wadham, president of Restaurant Office Intelligence, a hospitality consulting company. “It was absolutely the right time from a perspective of what the market was demanding for food. They’d gotten out of the whole pasta, healthy vegetarian stuff. That had come to an end and meat was coming back into favour.” Adds Aisenstat, who became president and CEO of Keg Restaurants Ltd. and Hy’s Steakhouse: “I didn’t think the steakhouse business was ever as bad as many people perceived.” On a recent evening, David Aisenstat dined at Hy’s. Predictably, the meat mogul ordered a charred rare filet, baked potato, Caesar salad and “a good bottle of wine.” His cheque arrived around midnight. “As it happens, I love eating steak. So I find myself at either The Keg, at Hy’s or Gotham a couple nights a week at least,” he admits. After a recent trip to Cabo San Lucas, where he golfed and ate everything but steak, Aisenstat admits somewhat sheepishly that he drove directly from the Vancouver International Airport to Hy’s Encore for dinner. “Did not stop at home to change.” As he relaxes on a black leather sofa inside his condo-size office at the company’s office-park headquarters in Richmond, Aisenstat apologizes for sounding hoarse. He’s been feeling under the weather all week, a condition probably made worse by the crate of wine recently delivered to his office by a Washington State producer hoping to be added to The Keg’s wine list. “He gave us some to try out. That was the start of my downhill slide yesterday. [We] cracked a bottle at about three in the afternoon and went downtown, and that was the end of that until midnight,” Aisenstat confesses. His gravelly tone may also have something to do with the fact that yesterday he sat alone inside his black, 500-hp Mercedes SL 55 in The Keg’s corporate parking lot singing along to Led Zeppelin for 30 minutes. “They were playing side two of Houses Of The Holy,” says Aisenstat, who recently turned 50. He was a little late for a business meeting, he explains with a shrug. “I wasn’t getting out until they finished playing.”


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Finance & Investing | Small Business | Food & Drink

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