(Image of UCC during annual Lockport Arts Festival, Metropolitan 3rd facade in)Buffalo News has an article today on the loans provided to Peter Calieri for Metropolitan.
In the Union Station post there was some discussion on grant money. I've always felt granting/loaning to non brick and mortar projects to be the most risky. Esp restaurants, etc which always seem to be hit or miss. And with no building to take possession of after the default, there is a big loss.
Calieri personally guaranteed repayment. “His corporation is now liable, and he’s personally liable,” Ottaviano said.
I wonder what the actual terms of the loan were relating to defaulting on it? If they were loaned to "him" instead of the "restaurant' do they still have grounds to be repaid seeing that the village Eatery is still in business?
Anyone eat at Metropolitan? I never got there. I have been to Taboo and was surprised by the lower prices given the more upscale interior. Nothing too fancy meal wise but I have enjoyed them. I always wish there was more warning when a local place was considering closing to give people a chance to at least try it once or to make a little extra effort to support something they enjoy. Even with the economy being bad, there are still no shortage of full lots at Olive Garden, Red Lobster, etc.
UPDATE 11/18/08:
Link for LUSJ article from Rocketboy
UPDATE 11/21/08:
www.lockportjournal.com/local/local_story_325231843.html
14 comments:
My wife and I ate there when it first opened, and it was very good, then ate there again a few months later, and it was not so good, and then again fairly recently, and it was not good at all. Seems like the kitchen must have gone through some changes, because I heard the same story of decline in quality from a few people.
I had lunch a couple months after they opened. It was just okay. It was way overpriced, and the portions were too small. Even in that early stage of the business I couldn't fathom a success.
The decor is very nice, and the staff was friendly. It is just a shame, and I hope it doesn't just sit empty. Maybe Taboo could use it for banquets or band nights.
The story here is as much about the GLDC and how they operate as it is about how a multi-Millionare got the GLDC to " loan" him money to open a high-end eatery in Lockport.
I would feel a lot more comfortable if I understood what the GLDC is and where it get's it money. The GLDC is a Not-for-Profit 501-C3 with assests of $6.4 Million Dollars.
Their Form 990 is 58 pages long and an interesting read. Non-the-less Mr. Calieri owes somebody $350,000.
On the other side of the City..anyone know how the Tuscarora INN is doing?
I haven't had a chance to eat at this restaurant either. I've been over to Taboo while I'm in town as everyone seems to have migrated there from Finnan's.
I think RMM makes a good point; wasn't there a similar issue w/ the Brewhaus in that the owner relied heavily on GLDC grant $$ and eventually put up her own home as collateral? It does seem like risky business. Just wondering what the decision process is for bestowing these grants/who makes the decisions...etc.
Wow, no rent for 1 year and 2% interest loans. That's a killer deal.
Instead of going through this trying to auction off the assets, why not just seize the assets and offer the entire set-up to someone else if they resume payments on the loan? This could relieve Calieri (a bit) while someone else pays on it.
Or why not work with Calieri to introduce a new format and menu. It would be a huge waste to dismantle all of that and there are so many types of restaurants missing in Niagara County, if not all of WNY. What are they going to do? Auction it then offer someone else some money down the road to reopen and re-buy equipment?
The GDLC (and Buffalo Economic Development Corporation) have continually shown restaurants to be too risky to bother with. Especially with loans not tied to brick and mortar. At least with Calieri, you could think that an already successful local owner would be not as risky. But the money has been loaned and spent. Before we take it in the chin, it may be worthwhile to seek out a new tenant/new format before the fire sale.
As for the asking to leave a table, there are better ways to do it. Tell a table, "You are welcome to continue to enjoy yourself here at the table, but if you wouldn't mind moving to the bar to socialize we'll give each of you a free drink” etc. And was Metropolitan that busy to need forced turnovers? I know if I am somewhere and we hang out extra long at the table I make an effort to remember to give the waiter extra tip money for their loses (of not getting a new table)
I never ate lunch at either place. I heard that the Metro was overrated, and it appears from these comments that it is. $400,000 is a lot of money to invest and Calieri must have went high end because that is just ridiculous when all he did was place some items in a shell of a building. How much of his own money did he have to front for this? And I agree MJ, not a bad deal - no rent for a year?
Maybe the GLDC will learn that hard lesson - Fool me once, shame on you. Fool me twice, shame on me.
Sounds like Mr. C had a pretty sweet deal. Also sounds like Mr. C does what he wants evident by his strange manner of hospitality, i.e. asking people to get up and leave.."what up wit dat"? Anyone with even a little knowlege about marketing a concept could have thought of several alternatives to default. Hopefully no one gave him the impression that if it didn't work out, they would let him out of the deal. I'm thinking of opening a "Chicago Style" Hot dog and Italian Beef joint..and I won't ask anyone to leave. Think I can Make a go of it...?
I agree that, while not knowing the legalities etc of everything, it would seem like a logical first step to try to repackage the whole thing to someone else. Whatever they would "buy" the equipment for would then be deducted from Mr. C's debt to the GLDC. Especially if they were feeling the itch to try to "help" another restaurant venture. Why sell it at a fraction of the cost and then loan to someone else to rebuy everything?
Though its pry a lot more complicated in reality and there are pry those just wanting to cut losses as quick as possible for such a large loan.
Even in lean times, a restaurant that gives great percieved value and service will succeed.
Someday I'd like a nice brew-pub to fall into Lockport.
Maybe I was lucky to have visited the Metropolitan on good days but I was indeed a fan. The dinning room was crisp, clean and attractive, the help pleasant and actually helpful, and the menu varied and creative.
I did notice (possibly imagined) a lowering of prices there over time and was curious whether slimmer profit margins in a small but relatively upscale dinning room would be sustainable in Lockport, given the limited audience. Apparently not.
Having traveled to most major metropolitan areas in the US on business, I enjoyed having a comparable finer NY / Chicago style restaurant available in the area, and I am curious if anyone might suggest an alternative? Please don't get me wrong, I enjoy Reed's hot dogs as well, but will always appreciate the option to choose something besides the size of a steak in a well presented fashion.
Throw in some live jazz standards on Saturday night and I promise regular visits.
http://webmaxtor.blogspot.com
Thanks for the comment WM.
I do hope something else can fill that highly visible location. As for the Jazz, possible something approaching Mark Goldman's initial vision of the Calumet which started the Chippewa St growth in Buffalo?
There is always growth available for unique high quality offerings. Hopefully we can snag one.
Kansas is playing the concert series this Summer. July 12, 2013.
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