The Raleigh City Council today approved a rent restructuring for The Mint restaurant located in the city-owned building One Exchange Plaza on Fayetteville Street.
The revised agreement between the city and Raleigh Restaurant Group reduces the rent by $1,159.63 per month for three years and then recoups nearly all of that money with higher rents in the later years of the lease.
The restructuring reduces the overall value of the 10-year lease by $339.
The Mint opened in January 2008, shortly before the economy tanked and consumers severely cut back on eating out.
The original lease started at $20 per square foot and was scheduled to gradually increase to $25.59 in 2017.
When the lease with Raleigh Restaurant Group was first announced, the fairness of the deal was questioned by several competing restaurant owners in downtown.
The city spent $1 million to lure The Mint into the ground floor of One Exchange Plaza, a 10-story building it bought for $8 million in 2003.
The city made clear that it wanted a particular type of high-end restaurant downtown.
The Mint's lease states that the restaurant will serve food in a "white tablecloth metropolitan style" and shall feature "low country" cuisine as a prominent part of the restaurant's menu.
Most of the taxpayers' money spent on The Mint went towards installing the infrastructure necessary to operate a restaurant.
The Raleigh Restaurant Group invested an additional $2 million to create the dining atmosphere, according to the group.
City officials said in a release today that the restructuring of The Mint lease is not unusual considering the bad economic climate.
"City staff contacted real estate sources that work with the restaurant industry and found that rent reduction, deferrals and restructuring or other concessions are not unusual in this tough economic climate," the release said.
"The sources reported that restaurants similar to The Mint are being especially hard hit by the slow economy. The lease rates between the City and Raleigh Restaurant Group, LLC, are market-based and the terms of the lease are all current by the tenant."
Business reporter David Bracken came to the N&O in 2004. He covers commercial and residential real estate. Contact David at 919-829-4548 or
Comments
Most tax payer money
Tue, 04/19/2011 - 18:27 — PhantomLordMost tax payer money wasted.
Where do I sign up to get a million dollars from tax payers to open an eatery?
The statement that the adjustment can be recouped later
Tue, 04/19/2011 - 17:39 — Platowasrightassumes that this restaurant has a "later". If it were doing well, it wouldn't need for the taxpayers to give it yet another subsidy. Anyone want to take a bet on it being here, "later"? One more Mayor Meeker idea that is getting more expensive. A Civic Center that requires millions of dollars in City and County transfusions per year, parking decks that are not generating sufficient income to pay their bonds and require more taxpayer transfusions. Meeker isn't finished yet. He wants to spend hundreds of millions on a ridiculous Rolley Trolley light rail scheme that will be like the others, way over budget on expenses and nowhere close to ever breaking even on revenuea v. expenses. Then there is the ultimate white elephant $223 Million dollar boondoggle of an office building that he wants to build that is far more expensive than existing buildings that are emptly and ready for occupancy, just not in his downtown. I won't mention the $23 million in unauthorized architectural work that were rejected that Meeker and the City Manager approved WITH NO AUTHORITY TO DO SO.
We need a new Mayor that isn't so far out of touch with the taxpayers in this city.