D&D boss David Loewi: Labour will be great for hospitality
For three decades David Loewi and Des Gunewardena ran one of the biggest and most successful restaurant companies in the land. They were the titular “D”s in restaurant group D&D – David the classic restaurateur, Des the business guy – opening dozens of restaurants together and helping to change the face of UK dining.
But two years ago Gunewardena shocked the industry when he announced he was parting ways with the company, citing a “fundamental difference of views” with the then-stakeholders in a CityAM exclusive interview last month.
Since then LDC, the venture capitalist firm he fell out with, sold their stake to Byron Burgers backer Calveton and Breal Capital for a reported £60m, ushering in a new era for the company.
I met Loewi last week at perhaps the most recognisable restaurant in the company’s portfolio, Coq d’Argent, a City landmark so iconic my first editor at this newspaper took me for lunch there when I joined to introduce me to “our readers”. It was a day typical of 2024, raining so heavily I practically had to swim into the restaurant, arriving dripping wet for our chat. This rain cannot be good for business.
“It’s not,” agrees Loewi. “We’ve got such beautiful terraces. We’re busy today, but it will literally double when the sun is shining. It costs the whole industry a lot of money.”
I think Des’s new restaurant is bold. He’s done it beautifully. It’s bringing more attention to the area. I don’t think one needs to worry about competition, it keeps you on your toes.
We are not here to talk about the weather, however. A week earlier Loewi and I had been at the same party – the opening of a new restaurant a couple of minutes away from Coq d’Argent, in a former D&D site at Royal Exchange, opened by none other than Des Gunewardena. This must feel a little like his former partner parking his tank on D&D’s lawn?
He smiles and shakes his head. “I think it’s very bold. I think he’s done it beautifully. It’s bringing more attention to the area. When the Ned opened, our business went up. Competition can be healthy. When we opened Coq d’Argent, we were the first really big restaurant in the city and we were hoping others would join us to make it more of a destination. I don’t think one needs to worry about competition, it keeps you on your toes.”
Still, parting ways after a working relationship that’s outlasted most marriages must have been tough – are they still close? “It was a great relationship. We had great fun together building the company and we’ve got a strong connection. I’m very fond of Des and we stay in touch. He invited me to his opening party. We’ve got a lot of history together. It was just a parting of ways, really, because LDC did not have the appetite to grow the company. Des is an entrepreneur, and he wants to drive the company. It was about timing.”
For his part, Loewi claims he was never tempted to follow Gunewardena out of the company during those darker days, saying “I love the business. I love the people in it.”
In the months following his departure, Gunewardena made an unsuccessful attempt to buy the company back – does Loewi think there could still be a space at the table for Gunewardena (who told me “who knows what happens in the future”)?
“I think Des is now focused on what he’s doing, and he’s got exciting plans to grow his company. But never say never…”
Loewi is, of course, more interested in talking about the future than the past. D&D has plans to double the size of the company to more than 60 restaurants, with eyes on cities in Europe, North America, the Middle East and the Far East, as well as more UK sites. “Growing has always been part of our DNA – I’m looking particularly at the moment in the States, I’m having conversations with a number of landlords that will hopefully bear fruit in the not too distant future.”
It’s an incredibly ambitious plan for D&D, especially with the shadow of Covid still casting a long shadow over the hospitality industry. Calveton and Breal Capital have clearly switched on the taps. “They have the same aspirations I have. They are excited about growing our company.”
Does that imply LDC weren’t interested in growth? “Look, LDC were venture capitalists and venture capitalists go for a certain number of years and then they want to sell out. They were very good partners for many, many years but if you look at their portfolio, they were scaling down, so they didn’t have the appetite for growth that we have.”
It strikes me that £60m sounds like something of a steal for a company the size of D&D – did the new stakeholders get a bargain? “Over the years we’ve had higher valuations. But it was a fair price and we’re in for the long haul, to grow the business. There have been peaks and troughs and now we have to grow the the company back to a valuation that would be fairer.”
A Labout government is a positive thing for the country. Keir Starmer has a highly intelligent, very decent vibe
Loewi is hopeful about the coming years, not least the new Labour government, which he describes as “a positive thing for the country”. He says Keir Starmer has “a highly intelligent, very decent vibe” and that the UK is crying out for some fresh ideas. He says he works closely with Kate Nicholls, CEO of UKHospitality, and is actively speaking to MPs about ways to bolster the hospitality sector.
This includes lobbying the government to reassess the current rate of VAT on restaurants, which far exceeds that in France and Germany, and reconsidering business rates, which are among the highest in Europe. He also points to the legacy of Brexit, which he describes as “very sad” and “a great lesson for the rest of Europe”.
“Trump threatened to build a wall between the States and Mexico, we built a wall between ourselves in Europe. We’ve got staff over in Europe who we’d love to come and work in the UK. And we basically said, ‘You’re not welcome’.”
He points to his own career, which saw him work in countries including Switzerland and France: “I loved it. It made me the person I am.”
And Loewi clearly does love this business. At 65-years-old, is he not ready to take a break? “Terrance Conran was 65 when he started opening restaurants. Jeremy King is still opening restaurants. It’s about your passion and drive and enthusiasm. We’re in showbusiness. Look out of the window – it’s a horrible day, but you come somewhere like Coq d’Argent and it makes you feel great.”
And he’s right, a bit of smoked salmon and a bowl of risotto really does take the edge off the British summer – I look forward to eating in a host of new D&D restaurants in the years to come.