The Pier Restaurant in Flagler Beach straddles the city’s most iconic landmark. As such, the 48-year-old restaurant should presumably complement and enhance the city’s image, especially since the property is owned by the city. But here’s how customers see the place: “This place is dirty and we are not coming back.” “Wanted to dine on the ocean and not inside. For such a prominent location it does not represent this community in a very good light.” “I have lived here all my life used to frequent often but no more because they don’t give a damn they won’t even seat ya when you walk in.”
Leaving a bad taste in visitors’ mouths is an easy way to ensure that they won’t return.
- Consultant’s Full Report
- Ormond’s River Grille Owner Closer to Taking Over Flagler Beach’s Pier Restaurant
- Great Ocean View, Fun Pier, 5,000 Landlords. $3,329/mo. (Big Chains Need Not Apply)
- Barshay’s July Proposal
- Barshay’s April Proposal
- The Pier Restaurant “White Paper”
For several years now, it’s been clear to customers of the restaurant and to city commissioners that the restaurant’s lease owner, Kaitlin Meyer, isn’t interested in running the place anymore. Her lease expires in April 2012. She wants to cede the place to Raymond Barshay, who runs River Grille on the Tomoka in Ormond Beach and has designs to turn the Pier Restaurant into a dining destination worthy of its location. Several obstacles stood in his way.
The city last spring was uncomfortable with letting Barshay assume the lease outright. Commissioners wanted to see what interest there might be among other restaurateurs for the property. The administration produced a “white paper” summing up the property’s history and value and advertised it to potential takers, but only briefly, and in three Florida markets—Tampa, Orlando and Jacksonville. There were few takers. Those who called didn’t follow up. Barshay was still the front-runner. Then the owners of the Flagler Fish Company made a pitch, saying they should have as much a right to bid on the property as Barshay.
Still uncertain over how to proceed, commissioners decided to let a consultant evaluate the Pier Restaurant lease and make recommendations. They hired ParkLand International Realty, which has been involved in evaluating restaurants as famous as Windows on the World, the restaurant that once occupied the top floor of 1 World Trace Center. It’s from Parkland’s report that those customers’ reactions to the Pier Restaurant are quoted.
“The main reason restaurants fail today is because of the management of the restaurant,” ParkLand’s Jim Densmore said. The report was submitted to commissioners last month. It was as if custom-written to set the table for Barshay’s venture.
Barshay’s own proposal, submitted to the commission in April, includes proposed investments of between $400,000 and $500,000, rent payments of $35,000 in the first year with additional rent payments based on 1 percent of sales above $1.2 million in the first two years. The $1.2 million is based on an assumption that the restaurant would generate at least $20 per seat per day in the 158-seat restaurant. (Meyer is currently paying $32,400, so the difference would be slight.) Barshay would also add outside dining and enter into a 10-year lease with the city, with option to renew three times in five-year increments.
Here’s what the ParkLand consultant concluded: Require the new tenant to commit, in writing, to an initial investment of $450,000 to $600,000 and require that that investment be verifiably spent according to a 12-month occupancy timeline; First and second-year rent would be set at $3,000 a month, or $36,000 a year. Additional rent based on a percentage of gross sales would be negotiated. Between 2 to 5 percent of the tenant’s sales would have to be spent on marketing and advertising.
“This icon location today does not promote the city the way she deserves,” the report states. “This is the flagship and identity of Flagler Beach. Our suggestions include exterior face lift in keeping with a nautical theme; open up either road frontage side, North or South with some outside dining including umbrellas. This simple suggestion is signage that here inside is an ‘active’ dining facility. There should also be open-air dining on the beachside either on the pier or a beachfront deck or both should be considered.”
The report also recommended that the city produce a request for proposal that would invite any restaurateur to bid to take over the lease. But the report’s “target tenant” stressed that the new lease holder should be a seasoned, with eight to 10 years’ experience running a restaurant, and one who’d be willing to also take over the bait and tackle shop and operate the pier itself, with responsibility for keeping the bathrooms well maintained. The income of the bait and tackle shop would be entirely the new lease owner’s. Pier fees would all be returned to the city, though a cottage business would b allowed on the pier, with 50 percent of its proceeds going back to the city.
While the report suggested an RFP, Densmore, the consultant, also recommended to commissioners, referring directly to Barshay, that “it would be beneficial for this person to assume the current lease.”
That’s what commissioners wanted to hear. “I’m ready to say to the attorney to start negotiating,” Commissioner Joy McGrew said. “We were long overdue to have someone in there. It’s become an embarrassment for the city and I’m ready for things to change.”
Commissioner Steve Settle repeatedly said he wanted a “hard bargain” with Barshay, and higher payments from the property. But the commission was more interested in keeping Barshay’s interest in the restaurant, and voted unanimously to start negotiations with him.