Popular Catalan restaurant is one of the first hospitality victims of the coronavirus pandemic
The owners of Lunya, the Catalan and Spanish restaurant, bar and deli in Barton Arcade, have announced that they will not be reopening, even when current government restrictions are lifted.
In a recent statement to local press, Peter and Elaine Kinsella said that although they have made the very difficult decision to close the Manchester site, this won’t affect their Liverpool restaurants in Hanover Street and Albert Dock, or their online business.
If we cannot get through this without a site closure, how will the rest of the industry?
The statement says; 'The impact of COVID-19 has been profound on our business and we cannot survive the future with three restaurant sites. As soon as we partially open with space restrictions, the losses that we will collectively make will be too great to sustain across all three sites and risk bringing the whole company down. No matter what projections we do and what actions we try, sadly we cannot find a way to make it all work.
'We have been in discussions with our Manchester landlord, our lenders and government agencies trying to secure additional funding and support which could help, but we have been unsuccessful in most of this, and there is no option that we can find that means Lunya Manchester can be viable.'
Peter and Elaine Kinsella founded Lunya - a true independent, family-owned business - in 2010, and still run it. Having fallen in love with Catalan food and culture and then all Spanish food and culture, they gave up their careers as a management consultant and educational psychologist in health/social care and education services to bring the very best of Catalan and Spanish food and drink to the UK. Lunya Manchester has been very successful since opening almost five years ago, winning various awards including City Life ‘Restaurant of the Year’ in their first year of opening. Lunya has also been listed in the Good Food Guide every year since they have been open.
'We have been successful on so many levels and have loved every minute of it,' Peter and Elaine’s statement goes on to say. 'The last two years since the Brexit referendum have presented additional challenges for everyone in the hospitality industry, and especially us as a hugely import-focused business.
'With declining consumer confidence, a huge drop in the euro exchange rate and large increases in business rates, general costs and overheads, this has meant significant cost pressures and taken together with the devastating impact of the closure from the Coronavirus, it has made Lunya Manchester financially untenable, and our current site too expensive to operate from for as long as we can see.
'Our two Liverpool sites are the profitable sites and to protect those, we have had to take the very painful decision to close Manchester to give our remaining businesses in Liverpool a chance and minimise the losses that we will build up as we partially open our Liverpool sites. We think that we can manage with two sites opening with partial covers, whenever the government allows us to, and certainly with the fantastic support our customers have shown us so far, we are as confident as you can be.'
However, loyal customers based in Manchester will still be able to order Spanish and Catalan products, ingredients and booze online through Lunya via operations based in Liverpool’s Hanover Street. Peter is also in talks with possible partner venues to provide a click and collect service at a venue to be determined.
'We think there is a way for Lunya to have a ‘virtual presence’ in Manchester, but sadly not operating as a restaurant, deli and bar in Barton Arcade. And in the future, if we can find a smaller and more cost-effective site, we may well be back in years to come.'
Back in March, Peter made an impassioned plea on Twitter in response to the Chancellor’s announcement to introduce loans to help struggling hospitality businesses. The tweet, which was posted in the period after lockdown was announced, but before the furlough scheme was introduced, quickly went viral (read more here.) In the heartbreakingly honest post, he pointed out that in the ten years his business has been open, he has ‘rightly and gladly’ paid £7.1 million in taxes in addition to PAYE and NI contributions to 105 members of staff and would have trouble paying back a government loan.
I don’t think @10DowningStreet will ever see this, but who knows if it gets retweeted enough. A letter to the Prime Minister pic.twitter.com/6NOoh9G1h6
— Lunya Liverpool (@Lunya) March 18, 2020
Soon after, Lunya placed all of their Manchester staff on furlough, which they are hoping to maintain for as long as possible, but some job losses are likely to be inevitable.
“Given the changes to the furlough scheme in coming months, we envisage our staff finishing at the very end of August, when all of our staff are likely to be made redundant as the contributory costs to furlough are not tenable without income,” says Peter.
“We have started a statutory redundancy consultation with all of our 30-strong team. We would urge any other restaurant operators who are seeking talented chefs, waiters, retail staff, bar staff and managers to consider the huge talent that our staff have as they seek to recruit to their teams. We have looked at opportunities for redeployment in Lunya Liverpool and Lunyalita into operational posts, but we have no vacancies in either of those sites.”
In regard to the wider industry, Peter adds: “We think there will be many more closures such as this across the country. We have not qualified for any government support grant, and possibly with that we may have been able to risk carrying on. We have insurance cover for pandemics, business interruption and forced closure, but as so many restaurant operators are discovering, insurers are denying claims and we will continue to fight for ours, but even if it is successful, it will now be too late.”
How does Peter see the outcome from his impassioned letter to the Prime Minister in March regarding what action the government needed to take to support businesses?
“Whilst some things improved, the government response was not enough,” says Peter. “We tweeted that letter out and it was seen by 2 million people (nearly one in 30 of the UK population), that produced so much support for Lunya, outpouring of love and expressions of empathy. It worries us that, if we cannot get through this without a site closure, how will the rest of the industry? We are a strong and successful business.”
Having just celebrated ten years since first opening in Liverpool, Lunya is one company with three sites: Liverpool (since 2010), Manchester (since 2015) and Lunyalita in Albert Dock (since 2018). They have pioneered a number of things including being the first venue in the UK to offer Estrella Damm on draught, they introduced the fabulous Café Saula coffee to the UK from Barcelona and were the only restaurant in the UK to serve mackerel semen from the Basque Country.
During the COVID closure, Lunya has been making and delivering free meals for the NHS and other caring staff. In the next week, they will be delivering their 3000th meal and are continuing this vital and very well received initiative.
