What caused the downfall of New York City's glitziest restaurant?

Le Cirque, on the Upper East Side, was the city's go-to power spot for 40 years

One evening in May 2002, guests in evening dress crowded into Le Cirque 2000’s red dining room in midtown Manhattan’s Palace Hotel. The unofficial VIP space in the storied restaurant’s second New York location featured a lurid explosion of heavy silk brocade, red-and-gold banquettes, and fawning waiters carrying silver-covered trays.
 
Guests that night included chief executive officers and a smattering of A-list celebrities. Ivana Trump and her then-boyfriend Roffredo Gaetani sat at in the centre of the room; a few tables over was Jocelyn Wildenstein, the billionaire-ex wife of art dealership scion Alec Wildenstein, dining with an impishly younger male companion.

 
Soon, Donald Trump and his then-girlfriend Melania entered the restaurant,  and guests—many of them halfway through the restaurant’s signature pasta primavera—paused to see how an interaction between long-divorced Donald and Ivana would play out.
 

Fifteen years later, the restaurant, now in its third location, has suffered a series of indignities: Demoted to a single star by the New York Times, it explored offering early bird specials as it struggled to meet its bills. Often, during the power lunch hours, most of its tables remain empty. On Tuesday, it was announced that the restaurant has filed for bankruptcy. Co-owner Mauro Maccioni is adamant that his family is not closing Le Cirque but admits that if finances were better, there would be no bankruptcy. “Fine dining is not what it used to be, especially when you have a 150-seat restaurant,” he said. over the phone. “The recent changes to labour laws, and changes to the industry can put you behind the eight ball and we did not modify our operation fast enough.”

 
The downfall of Le Cirque can be chalked up to many things—unsustainably high operating costs, changing restaurant trends, increasingly lacklustre cuisine — but its rise and fall also track, with an almost uncanny accuracy, the shifts of New York’s real estate market.
 
At its height, Le Cirque was at the centre of New York society when the latter revolved around the Upper East Side.
 
Later, as new buildings popped up in neighbourhoods whose land was cheaper and more available— TriBeCa, Chelsea, and the far West Village, in particular—Le Cirque’s grip on the power crowd began to weaken. In 1994, Nobu, the celebrity-studded Japanese restaurant, opened in TriBeCa; Balthazar, the buzzy French brasserie by Keith McNally, opened in Soho in 1997; Jean-Georges Vongerichten’s Perry Street restaurant opened in 2005 in one of the sleek West Village buildings designed by Richard Meier; Locanda Verde opened in 2009 in the Greenwich Hotel. “So much luxury development was created in the last decade and a half in parts of the city where it was easier and more conducive to build,” said Miller. “And that drew consumers, along with new support services,” he said. “One of those services was high-end restaurants.”

 
Even as some regulars continued to swear by Le Cirque, it closed its doors at the Palace Hotel due to labour disputes in 2004 and moved in 2006 to its current location on East 58th Street in One Beacon Court, where Bloomberg LP is also located. A few years later, Wells, the restaurant critic, visited the restaurant and had a less-than-happy experience. With so many high-end competitors, Wells said in the Times, it was hard to justify a meal at the restaurant. “These are not the best of times at Le Cirque, and I could never square what I’d eaten with what I’d been asked to pay for it,” he wrote in 2012. The restaurant and its cooking were out of touch.