The Celtic Tiger is losing its appetite for fine dining. The Mill at Lyons Village in Co Kildare, a 70-seat restaurant set up two years ago by Richard Corrigan, is set to close next month as the economic downturn bites.

Trade sources feel that slimmer pickings for top restaurants could be a taste of things to come, with rising food and utility costs coupled with straitened expense accounts proving a recipe for disaster.

Several eateries have closed in Dublin in recent months, including Il Pomo D’Oro on South William Street and Crush on South Great George’s Street. Others have cut back their opening hours, including L’Ecrivain, the holder of a Michelin star, which no longer opens on Mondays.

John McKenna of the Bridgestone Guide said that restaurants are always the first casualties of an economic slump. “There is a high attrition rate anyway, but when you take into account rising food prices, fewer tourists from America and cutbacks in expense accounts, closures are inevitable,” he said.

Failte Ireland say 600 restaurants opened in Ireland between 2000 and 2006 on the back of the economic boom. But while there were 2,621 licensed restaurants in Ireland two years ago, this number could now be on the slide, according to Henry O’Neill of the Restaurant Association of Ireland.

“Every business that suffers from discretionary spending is suffering. Even before the boom, the rule of thumb was that 50% of restaurants would go out of business in the first 18 months,” he said.

Anecdotal evidence suggests that restaurants outside Dublin are suffering more, according to O’Neill, with price-conscious diners eating into restaurants’ profit margins. “People are more aware of value and more likely to seek out an early-bird menu or have a glass of house wine instead of a bottle,” he said.

The demise of The Mill at Lyons Village, which won the Jacobs Creek Guide award for best new Irish restaurant last year, is the highest-profile casualty so far.

Corrigan, the restaurant’s original head chef, described the €50m project as “the biggest food venture the country has ever seen” and said the “epicurean idyll” would combine the best Irish produce and talent. But diners may have found the prices at The Mill hard to swallow, with a typical two-course meal of crispy frogs’ legs followed by poached and roasted squab pigeon with truffle ragout costing €75 and a glass of wine selling for about €12.

In a review in The Irish Times soon after the village was launched, Tom Doorley described the development as “aimed largely at insecure Celtic Tiger cubs”. A series of artisan food shops never materialised.

A Lyons Village spokesman blamed the closure of The Mill on the “current climate” but said that Cafe La Serre, a less formal restaurant also in the grounds of the 600-acre Co Kildare estate, would remain open.

“After a review of the long-term market for high-end dining, it was decided to close The Mill and focus instead on Cafe La Serre. We hope that The Mill will be used for private events and weddings,” she said.

Corrigan said The Mill had been an integral part of the late Dr Tony Ryan’s vision for the village. “It was very much his project. With his guiding hand it might have continued through the downturn but if a part of your business is losing money, there comes a time when you have to pull the plug and focus on what’s successful,” he said.

Corrigan partly blamed stricter policing of drink driving. “That has played a huge role outside Dublin. People used to have a meal with a glass or two of wine but not any more,” he said.

Derry Clarke of L’Ecrivain said he had closed his restaurant on Mondays to cut costs. “The cost of produce and utilities has spiralled in recent months, while at the same time corporate business has dropped off. We’re lucky in that we never relied on expense accounts and have a good mixture of customers,” he said.

Despite the rising cost of produce, top-end restaurateurs say they have been forced to freeze prices. A two-course set lunch in Patrick Guilbaud’s at the Merrion Hotel has risen by only €2 in the last year, while a set lunch at Peploe’s on St Stephen’s Green hasn’t increased in price in two years.

Barry Canny, Peploe’s proprietor, said that the cost of dairy produce had risen by 8% in four months. “People are far more price sensitive now, so we can’t pass those increases on. There are very few champagne lunches these days,” he said.

While Corrigan left the Village at Lyons earlier this year, he is hoping to launch another Irish restaurant on St Stephen’s Green later this summer.

The Co Meath-born chef said his new venture will be modelled on Bentley’s Oyster Bar & Grill in London’s West End. “You will be able to have a main course and glass of wine for €17,” he said.

“In one way, the downturn has been good for me. Without it, I would never have secured such a great location on the Green.”

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