Luby’s fends off board challenge from activist investor

Luby’s shareholders rejected an activist investor's attempt to wrest control of the restaurant company from the Pappas brothers on Friday, ending a 43-day proxy fight over the Houston chain.

Shareholders elected all the company's candidates for its nine-member board at its annual meeting, rejecting four nominees pushed by New York hedge fund Bandera Partners, according to preliminary results issued by the company.

Luby's did not release the voting count but said it was a close contest. Bandera said the election had a voter turnout of more than 85 percent.

Chief Executive Chris Pappas said in a statement that the company will look to improve its operating results.

"With this annual election now completed, our full focus returns to executing our turnaround plan for the business and ensuring that we have our right board composition to oversee our strategy," he said.

Jeff Gramm, a Bandera co-founder, said he accepted the preliminary results, which were reviewed by Luby’s proxy solicitor and will later be certified by an independent inspector of elections and filed with the Securities and Exchange Commission.

"Although it is early and we have not seen official results, we believe we won the vast majority of votes from non-affiliated shareholders," he said. "It is clear to me that Luby's shareholders are very frustrated with the company and desperate for change in the boardroom."

Friday’s election caps a bitter boardroom dispute between two prominent Texas families fighting for control of the iconic but struggling Houston restaurant chain known for its comfort foods, such as the LuAnn Platter. The company operates 82 Luby's Cafeterias and 59 Fuddruckers restaurants. It franchises another 104 Fuddruckers locations nationally.

Gramm, the son of former U.S. Sen. Phil Gramm of Texas, was seeking to oust Chris Pappas and his brother Harris Pappas from Luby’s board, which they have helmed for nearly two decades. The brothers also own and operate popular Houston restaurants Pappasito’s Cantina, Pappadeaux Seafood Kitchen and Pappas Bar-B-Q.

Bandera, which has been a Luby's shareholder for more than a decade, was lobbying fellow investors to replace the Pappas brothers, Chairman Gasper Mir III and board member Frank Markantonis with its own slate of candidates, which included Gramm and his father.

Bandera faced an uphill battle to pry control of Luby's from the Pappas brothers, who own 36.8 percent of the company's stock. Bandera has a 9.8 percent stake.

Gramm, who flew in from New York to attend the annual meeting, said he did not regret the proxy fight, which tested his close friendship with fellow activist investor and business associate James Pappas, Chris Pappas’ son. In a prepared statement to Luby’s board, Gramm encouraged it to listen to shareholders and wished it success in the coming year.

“I don’t regret my decision to take this vote to Luby’s shareholders,” Gramm said in an interview. “I really do believe that if I hadn’t done this, the company wouldn’t have committed to bringing some change to the boardroom in the coming year.”

Luby's last week announced plans to make some changes to its board in a bid to appease Bandera and other shareholders concerned with the company's stock performance.

Among the moves, Mir announced he would relinquish his leadership position to another independent board member later this year. The board said it is also looking to replace two incumbent members, several of whom are approaching retirement age, with independent directors. Luby's did not say who would step down but said the changes will take place later this year.

David Littwitz, the owner of Houston restaurant brokerage Littwitz Investments, said little has changed as a result of the proxy fight, however. Luby’s restaurants are unprofitable, the company’s stock is down and the company is still forced to sell off real estate to pay down its debt, he said.

“It’s still a tough situation for the current management to operate,” he said. “All this has done is give Chris Pappas some breathing room for the moment, but not by much.”

Ed Wulfe, the chairman of Houston retail brokerage Wulfe & Co. and a Luby’s shareholder, said he voted in favor of Luby’s slate of candidates.

“I’m very pleased Luby’s is staying in the hands of the Pappas, who are proven restaurateurs with years and years of experience,” he said. “I think in the long term, this is in the best interest of Luby’s and shareholders.”

After rising briefly midday, shares of Luby's fell 13.8 percent Friday to $1.56. The company is set to report fiscal 2019 first quarter earnings Monday.

paul.takahashi@chron.com

Houston Chronicle

Radio TropRock Blog: T-Bone Tom’s Party Under The Palapa

A Musical History At This Legendary Texas Restaurant & Bar

As owners of a trop rock radio station, Gina and I are very fortunate to travel to tropical locations to visit the best bars and live music venues.

For years we kept hearing that all the best artists on the trop rock circuit were playing at a place just outside Houston called T-Bone Tom’s. We thought to ourselves “Why are all these folks playing in Houston? Shouldn’t they be in Key West or something?”

We never really gave a thought to a venue in Houston being a good host for trop rock style music. After a little research we found out this place called T-Bone Tom’s at the Kemah Boardwalk, just southeast of Houston, had been on the Trop Rock Music Association’s nomination list as Live Music Venue of the Year for many years! We decided this venue must be added to our list of locations for a live broadcast on Radio Trop Rock.

A couple of short months later we found out exactly what all the fuss was about. Upon arrival, you can’t help but notice “Tom’s Backyard.” It’s a stage, bar, and seating area under a huge palapa. Some say it’s the largest palapa west of the Mississippi, others claim it to be the largest built in Texas. I don’t know the actual answer, but I can tell you it’s a big one!

Before I go any further, I should tell you a little more about T-Bone Tom’s history, because when you get right down to it, it’s actually a freakin’ fantastic restaurant first, and a kick-ass place to listen to music and party second. T-Bone Tom’s actually started as a meat market in the mid-1960’s and began smoking meats in the late ’60’s. Around 1974 it became a restaurant. The location became well-known by locals as “the place” to go for great bar-b-que and steaks.

In 1998 Barry Terrell, with many years of restaurant experience under his belt, had the opportunity to purchase T-Bone Tom’s. Barry was not at all new to the restaurant business. Decades earlier he waited tables while attending college and progressed one step at a time until the mid-1990’s when he was on the corporate side with Landry’s Restaurant Group.

Barry made little to no changes to the already successful menu of T-Bone’s but did decide to expand the rear of the establishment to add “Tom’s Backyard,” which consisted of a bar and a small area that could host live music. Kelly McGuire, a trop rock musician, was one of the first to approach Barry about playing there and apparently it went well because shortly, thereafter, T-Bone Tom’s began hosting live music every Friday and Saturday night.

T-Bone Tom’s continued to gain momentum through the early 2000’s. When Hurricane Ike hit in 2008 T-Bone’s suffered quite a bit of damage. Barry took that opportunity to expand Tom’s Backyard to include a larger bar, stage, and the huge palapa that people now  love to party under on those hot Texas days and warm nights.

In 2009 the Food Network show “Diners, Drive-Ins and Dives” shot an episode at T-Bone Tom’s. One of the menu items Barry had Guy Fieri try was my personal favorite; Armadillo Eggs. Strangely enough, these contain no armadillo, nor egg! What they do contain is shredded bar-b-que brisket. Think of a jalapeno popper the size of a huge egg filled with very tasty smoked brisket. My mouth is watering writing this now.

Other great items on the menu include their famous ribeye and Chicken Fried Steak. While everything on the menu is fantastic, these items have received local and national recognition as some of the best in the country. When eating at T-Bone Tom’s be ready to carry home some left-overs for tomorrow. Portions are large.  (Personal note: The Armadillo Eggs are fantastic for breakfast… Simply pull them out of your fridge and microwave for about 1 minute.  Yum)

Enough about the food, now more about the music!

T-Bone Tom’s hosts live music six nights per week. It has gotten so good at it that the Houston Chronicle has named T-Bone Tom’s the second best place to hear live music in greater Houston area. Think about how large Houston is, thousands of venues play live music. Coming in second is pretty damned good!

T-Bone Tom’s began it’s live music twenty years ago, and has since established itself as the BEST place to hear trop rock music. Proof of this is that last November in Key West, the Trop Rock Music Association named T-Bone Tom’s Best Live Music Venue in the country. They have consistently been nominated by the TRMA year after year, but in 2018 they beat out the previous winner, a venue in Key West, for the honor.  Yes, a venue in the Houston area beat out a place in Key West for best place to watch live trop rock music!

How did it get there, you ask? Well, to start with, T-Bone Tom’s is the home of one of the most successful trop rock songwriter showcases. John Burns, aka “Jon Boy” put together a songwriter showcase using talent from all over the country. The show is now frequently hosted by Jerry Diaz or Donny Brewer, two of the biggest names in TropRock. While Pirates and Poets Songwriter Showcase also has shows in Key West, New Orleans, Port Aransas, and even into Mexico, they call T-Bone Tom’s “home.”Pirates and Poets Podcast was recognized in 2016 as the Trop Rock Music Association Radio Show of the Year.

Here’s what John Boy of Pirates and Poets says about T-Bone Tom’s:

“T-Bone Tom’s is the perfect place to spend a fun evening with your friends or family. It has great food and cold drinks, plus its are located near many of the Kemah-area’s top tourist attractions. And its easily the best music venue in the area and they don’t charge a cover. They have live music six nights a week. Tuesday-Thursday features acoustic acts, many of which perform original material. The weekend are usually geared towards high energy cover bands.

“We’re lucky to have T-Bone Toms host our Pirates & Poets Songwriter Shows 11 months out of the year.”

T-Bone Tom’s hosts around sixty trop rock live music shows per year. Since Gina and I with Radio Trop Rock first visited T-Bone Tom’s October 19, 2016, we have broadcast live shows from there no less than twelve times, making it the most frequent broadcast venue for our TRMA award winning show Trop Rockin’ the USA on Radio Trop Rock. T-Bone Tom’s is also the “go to” place for many of the Galveston Bay Parrothead Club events. It is not unusual to find a large group of these brightly dressed revelers forming a conga line around the entire area under the palapa. They are especially active when folks like Jerry Diaz and Hanna’s Reef are performing. Jerry has been very instrumental in the growth of “trop rock” for a couple of decades, and it’s easy to see why when he performs for his hometown fans there in Tom’s Backyard.

While many restaurants that play live music may have great food OR great music OR great service OR a great atmosphere T-Bone Tom’s set’s itself apart from the others by having ALL of these qualities. Some people come for the food, and stay for the music. Others may come for the music, but stay for the food. What I mean by that is normally a person’s first visit to T-Bone Tom’s is for a reason, whether they’ve heard bout the great food, or maybe the great music, they go there for one, maybe not knowing about the other. Once they’ve experienced T-Bone Tom’s they are now very aware that T-Bone Tom’s is the whole package of great food, music, service and atmosphere.

Jerry Diaz has even paid homage to T-Bone Tom’s by writing and recording the song “Eat at T-Bone Tom’s” which is included on his latest CD Rum Drinks & Sandy Beaches. Jerry says in the song “They’ve got Mexican pickles and buckets of beer. Man it’s a party when Barry is here. Live music playing six nights of the week, cute little waitresses and fresh cut meat.”.  I’ve got news for you, it’s not just a party when Barry is there, it’s always a party!

Next time you are in the Houston area do yourself a favor and make the trip down to the Kemah Boardwalk and see why T-Bone Tom’s consistently receives accolades from local newspapers, national TV shows, and the Trop Rock Music Association.

Source: PubClub

Peeling Back The Onion: The Challenges Of Redevelop Redeveloping Older Product Into Mixed-Use →

Limestone vaulted arcades, Tuscan columns and deep window ledges highlight the historic frame of The Star, a century-old landmark building recently converted into a residential tower in Downtown Houston. Yet, beneath the beauty lies an incredibly difficult redevelopment process. Redevelopment of historic property presents a complicated combination of what needs to be done, what can be done while meeting tax credit guidelines, what developers want to get done and what it will cost. The Star, Texaco’s headquarters in the late 1980s, serves as a case study of the challenges of converting a historic building into a mixed-use development
Reactivating Historic Spaces — To Change Or Not To Change?

Executing the redevelopment dream requires patience and tough decisions, Provident Realty Advisors’ Kip Platt said. Platt is the project development partner over The Star. A key part of this redevelopment was selecting which spaces to renovate and which spaces to leave alone. Provident is already on year seven of work at The Star, a 286-unit luxury high-rise community, and it isn’t done yet. The company bought the property in 2012, after it had stood vacant since Texaco moved out in 1989, and completed converting it to multifamily in 2013. That redevelopment focused on the build-out of the residential units. In 2016, the site underwent another round of renovations, which modernized all of the units and common spaces and added new on-site amenities, such as an outdoor pool and an attached garage. Last year, it turned to the basement, which had never been finished out. Provident Realty Advisors made a sizable investment to build out that space. The company created a game and lounge room in the basement, inspired by speak-easies with gentle lighting. The space is all new but brought back in a historic feature — an authentic 12-foot-long TEXACO illuminated sign is a focal point of the space. Designer Lauren Parson purchased the sign from a former Texaco employee, Jim Conrad. The sign was designed for a gas station that never opened in the ’80s, he told Parson. “He was happy to send it back home,” she said. The game room walls are splashed with other memorabilia from the oil company. The bottom level also features a virtual golf simulator, a dog spa, a theater and a poker room. Parson also redesigned the top floor lounge area, which includes an open meeting and kitchen space, a sitting area with a television, an Equinox-inspired fitness center and an outdoor rooftop lounge. The final piece of the redevelopment will include an 18K SF full-service restaurant on the ground level by popular restaurateur Benjamin Berg, who also runs B&B Butchers. Stepping into historical mixed-use is new for him. His first location for B&B Butchers was a free-standing industrial building on Washington Avenue and Sabine Street. On that project, he had more build-out options (like putting things on the roof) and didn't have to consider how space engages with another space. But when you’re working with historic space, not all sought-after design elements will make it to the final draft. For example, Platt wanted to add a balcony to the units that featured deep window ledges. But as Provident began to research the option, it discovered that it could cost upward of $2M to repair the Renaissance Revival-style exterior finishings if they were damaged, and the finishings can only be rehabbed by Italian designers. The add-on was not worth the financial risk so the developer skipped it, Platt said.

Also A Pain Many developers dive into historical redevelopment projects in order to maximize state and federal tax credits. However, the guidelines can be strict, the process often spans years and developers must be willing to partner with regulators to get the final stamp of approval. "If a building still has a lot of intact historic fabric it is important to understand what must be retained and preserved before any work begins," Texas Historical Commission Director Chris Florance said. The Star was added to the National Register of Historic Places in 2003 and is an active tax credit project, Florance said. The National Park Service’s guidelines for the rehabilitation of high-rise buildings, one of the most common historic redevelopment types, say the building must be 50 years old to be listed on the National Register or awarded the state's Recorded Texas Historic Landmark designation. The first phase of work on The Star, which includes everything except for the first-floor tenant space and the rooftop amenity space, has already been certified for the State of Texas Historic Preservation tax credits. The project cannot be certified for federal credits until all of the work is completed. The developer has been working with the THC since the asset was purchased in 2012, Florance said. He said it is critical that anyone interested in the historic tax credits or other related programs should contact the organization before finalizing any plans. Since much of the building had been gutted before it was purchased by the current developer, there was not a great deal of historic interior fabric left to preserve, Florance said. The most historically significant features included the first-floor entry, the original elevator lobby and the overall exterior facade. The exterior work involved cleaning, repair and restoration of masonry and the replacement of the non-historic windows to be considered for tax credits. As the design process began for the restaurant, Benjamin, Berg discovered that he was in for a big challenge. Situated on the corner of San Jacinto and Rusk streets, Benjamin will occupy the former lobby of the pre-war building. The original wing of the building was designed by the New York firm of Warren & Wetmore, which is also responsible for Manhattan's 1913 Grand Central Terminal. The build-out includes constructing two kitchens, relocating the elevator and adding a balcony to overlook The Star’s heated outdoor pool. Berg found that some of the tax-related requirements were more difficult to overcome, and he had to find creative workarounds. In order to retain and expand the original flooring, he will implement a sealing system to level it with the new flooring. Other regulations disallowed structures or objects from being placed within 15 feet of the floor-to-ceiling windows, Berg said. Developers are also not allowed to closely mimic the previous use without pictures and other documents as a reference. The restaurant's design takes inspiration from the original black-and-white flooring but will not re-create the former lobby. Benjamin, which requested construction permits in late December, has faced delays as it worked through the redevelopment constraints. It was originally scheduled to open in 2018 but is now slated to open later this year. Making Everyone Play Nice Even when there is no historical component adding hurdles, mixed-use developers have to figure out how to accommodate the space to welcome customers without disturbing the other tenants. Common residents’ concerns include parking, increased building traffic and additional odors, Platt said. The newly added parking garage in The Star will offer free valet for the residents' guests and designated spots for customers. Benjamin will feature a cold room that will be used to store trash and contain the smells. You Can't Buy Special With all the pain, why does anyone bother? It is the built-in character of historic buildings that makes it worth the trouble, Berg said. Many features of older buildings would be too expensive to build today. The cost for The Star's grand windows would probably range from $50K to $100K per window, Berg said. The all-in renovation budget for Benjamin is about $6M. Plus, buildings like the former Texaco HQ are unique. "There is nothing like it in Houston," Berg said. "If you tried to build it yourself it would lose the specialness of it."
Source: BISNOW

Conversation: Nicole Bean, Pizaro’s Pizza, Houston

Owner Nicole Bean has recently moved Pizaro’s Pizza out of its original location and into a larger and updated location nearby that could handle its three pizza styles.

We operate a fast-casual concept with two locations serving Napoletana, New York and Detroit-style pizzas. We offer a simple counter service and table delivery without the hassle of servers or wait staff. We also serve both beer and wine in addition to B.Y.O.B (small corkage fee applied).

We opened in 2011 with Napoletana style pizzas.
There was a lot of education with customers during the first year and tons of feedback about wanting more toppings and a more substantial crust to hold those toppings from those who didn’t quite understand the concept of Napoletana pizza. We knew our Napoletana was great and didn’t take long to catch on here in Houston, but we wanted to give customers something more. After opening our second and larger location (closer to downtown) in 2015, I went out to San Francisco to Tony’s International School of Pizza to learn to make Detroit-style while also learning Chicago, New York and Sicilian. Matt and I launched Detroit six months after I got back from school. I used only social media and local press to spread the word on our newest baby. Response to our Detroit went better than expected and continues to grow. It was only a year ago (2017) that we launched New York-style, which took us 10 months of development with dough, tomatoes, cheese and market testing.

All three styles are thriving, they are almost to an even split among the orders.

There is also a possibility of a new style coming…

We got tired of telling people “no;” Napoletana is challenging to keep authentic in the United States. Educating customers helped, but we still had to cut people back from piling on the toppings, which made both the customer and us unhappy.

Detroit was a great solution. We had a thick enough dough to hold more toppings and the sauce went on top; it was a no-brainer, plus the cheddar crust … People love that cheddar crust!

After getting our handle on making two styles and seeing that our customers loved having an additional option, we knew the time was right to get going on New York. It had to be more rigid (than Napoletana) with a bit of a crunch. We were listening to what our customers were seeking out. New York style was the answer and so we began the process. As soon as we started posting on Instagram about testing it, people started calling and coming in asking about the New York style even before we launched it. The response was overwhelming!

Now, we have all three styles at the re-location of our original store.

Source: Pizza Today

Activist investor calls for “fresh faces” to turn around struggling Luby’s

A New York hedge fund is preparing to launch a proxy fight to take control of Luby's board of directors, which if successful would change the course of the struggling chain led for nearly two decades by a member of Houston's Pappas restaurant family.

Bandera Partners, which owns 8.9 percent of Luby’s outstanding shares, on Tuesday sent a public letter to the locally based chain, outlining concerns about the company’s direction and nominating five candidates to “improve the board with fresh, independent faces.” Members of the nine-member board are elected to a one-year term every year at Luby’s annual shareholders meeting, which is expected to take place in early 2019.

“I’m writing today to tell you that what’s happening at Luby’s is simply not working,” Jeff Gramm, Bandera’s co-founder and portfolio manager, said in the letter. “I believe this is the outside shareholders’ last chance to salvage their investment in the company, and I feel a responsibility to take on this difficult battle on their behalf, rather than subject myself and other Luby’s shareholders to another year of value destruction.”

Bandera’s proposed new board members are Gramm; his father and former Sen. Phil Gramm of Texas; Stacy Hock, chairwoman of Texans for Education Opportunity; Savneet Singh, a partner at New York asset management firm CoVenture; and Brian Wright, the CEO of Massachusetts-based Bertucci’s Italian Restaurants.

Gramm, in his letter, criticized Luby’s “bloated corporate expenses” and disagreed with the company’s strategy of closing restaurants and selling company-owned property to reinvest in the business and pay down $39.3 million of debt. Luby’s closed 21 locations this year and laid off some of its corporate staff to chip away at its debt.

Luby’s is liquidating shareholders’ most valuable asset: Luby’s real estate, Gramm said. The chain operates 146 company-owned restaurants under the Luby’s Cafeteria, Fuddruckers Restaurants and Cheeseburger in Paradise brands. The company this month reported nearly $200 million in assets, much of it in real estate.

“It is brutally painful to watch the company chisel away at its real estate portfolio to fund low-return investments into the business,” Gramm said in the letter. “Since fiscal 2008, Luby’s has sold $88 million of assets. This capital, more than double the current market capitalization, is gone and forever lost to shareholders.”

Luby’s, in a statement, said it will review Bandera’s letter and consider the hedge fund’s candidates. The board will make a formal recommendation later, the company said. Chris Pappas and his brother Harris Pappas, founders of Houston-based Pappas Restaurants, became majority shareholders of Luby's in 2001. Chris Pappas is CEO and president.

“We are always open to good ideas regardless of their source and will carefully review and consider Bandera’s candidates as we would any other potential directors to assess their ability to add value to the board for the benefit of all shareholders,” Peter Tropoli, Luby’s general counsel, said in a statement.

Luby’s, founded in San Antonio in 1947 and known for its comfort foods such as the LuAnn Platter, has struggled to retain diners in recent years amid growing competition from new fast-casual concepts, such as Shake Shack, which offer trendy foods and limited service that appeals to younger diners looking to share their dining experience on social media. Luby’s this year issued a statement of going concern, calling into question whether it can stay in business.

The company, in its latest annual financial report, said it posted $365.2 million in sales over the year, down 3.7 percent from the previous year. Same-store sales fell a half percent.

Luby’s reported a loss of $33.6 million this fiscal year, and its stock has lost two-thirds of its value since January. Shares ended the trading day Wednesday at $1.53, down from its peak of around $25 in 1993. The company has a stock market value of around $45.2 million.

“The market is no longer excited about a cafeteria concept,” said David Littwitz, a restaurant broker with Houston-based Littwitz Investments. “The younger customer hasn’t given a thought to Luby’s for a long time.”

Bandera, which has a stake in Famous Dave’s BBQ and has invested in Popeyes Louisiana Kitchen and Fiesta Restaurant Group, has owned Luby’s stock for more than a decade. The hedge fund has issued a number of public letters to company boards, including one sent this year to Boardwalk Pipeline Partners in Houston. Jeff Gramm is the author of “Dear Chairman,” a book on activist investors, and is on the board of Morgan’s Foods with James Pappas, an activist investor and son of Luby’s CEO Chris Pappas.

Another shareholder, Dallas-based investment firm Hodges Capital Management, has owned Luby’s stock for 35 years and said it would back Bandera’s efforts to change the board and the company’s direction.

Source: Houston Chronicle

Luby's closes 21 restaurants amid lackluster sales

Luby's, an iconic Texas restaurant chain known for its cafeteria-style comfort foods, is struggling to remain relevant in a hyper-competitive market as customers increasingly favor new, fast-casual concepts.

The Houston company, which earlier this year expressed concerns about staying in business, said Monday that it had shuttered 21 restaurants and laid off some corporate staff over the past year amid declining foot traffic and sales. The chain is in the process of closing and selling off additional restaurant to pay down $39.3 million of debt and negotiating with lenders to reach a refinancing agreement.

The company did not disclose the locations of the stores it has closed or plans to close, or the number of employees it laid off.

"Our aim and goal is to return to profitability," president and CEO Chris Pappas said in a conference call with analysts Monday.

Luby's, founded in San Antonio more than 70 years ago, operates 146 company-owned restaurants nationally under the Luby's Cafeteria, Fuddruckers Restaurants and Cheeseburger in Paradise brands.The company moved to Houston in 2004.

Luby's has struggled to retain diners in recent years amid growing competition from new fast-casual concepts such as Shake Shack and Flower Child, which offer trendy foods and limited service that appeals to younger diners armed with cell phones and social media sites to share their experiences.

"The sweet spot of the restaurant industry is the younger millennial who has some money and goes out a lot," said David Littwitz, a restaurant broker with Houston-based Littwitz Investments. "Luby's can work very hard to provide a good, hot, fresh meal at an affordable price, but they're just not what millennials are thinking about. There's nothing really Instagrammable about going down the cafeteria line and getting a meal."

Restaurant chains specializing in full-service, family dining have also struggled amid changing tastes. Applebee's and Outback Steakhouse have shuttered dozens of locations while others such as Ruby's Diner have filed for bankruptcy in recent years.

Luby's, which reported earnings Monday for its fourth quarter and fiscal year that ended Aug. 29, said its foot traffic fell 5.5 percent at Luby's Cafeterias and 8.3 percent at Fuddruckers during the fourth quarter. The company posted $365.2 million in sales over the year, down 3.7 percent from the previous year. Same-store sales fell 0.5 percent overall.

Pappas said Luby's executives are not satisfied with the company's financial performance.

"While operationally, there are several bright spots, the decline in profitability for the whole company is totally unacceptable," Pappas said. "In order to improve profitability, we must significantly improve traffic and sales."

Luby's closed four Luby's Cafeterias, 11 Fuddruckers and six Cheeseburgers in Paradise locations over the past year. The sale of 10 restaurants generated $14.8 million, about a quarter of the way toward the company's goal of raising $45 million. The company, which closed nine locations last year, is looking to shutter more underperforming stores.

Luby's provides food service management to hospitals, schools and corporate offices at 27 locations, and has several international locations in Canada, Central and South America, Poland and Puerto Rico. The food service division represented a bright spot for the embattled company. Revenue from food service contracts grew to $6.4 million this year, up from $5.8 million last year.

Last month, Luby's promoted Todd Coutee to chief operating officer to grow its sales and profit margins, which have lagged amid rising costs and lower guest traffic. Coutee said the company plans to use a combination of discounts, employee training on customer service and more popular menu options to drive foot traffic back to Luby's restaurants.

"I believe these are the keys to generate brand loyalty and repeat business," Coutee said. "We have iconic brands that are relevant in today's restaurant landscape."

Source: The Houston Chronicle

Brunch restaurant inks first retail lease in Australian co.'s apartment tower in Midtown Houston

The Flying Biscuit Café is the first retail tenant signed on for Australia-based Caydon’s new apartment tower in Midtown. 

The Atlanta-based restaurant will occupy more than 3,200 square feet at 2850 Fannin St., according to a press release from Caydon. The brokers on the deal were not included in the release.

The 27-story tower, slated to open next year, will include more than 13,000 square feet of retail space in addition to 357 apartment units. Houston-based Ziegler Cooper Architects designed the tower, and Alabama-based Hoar Construction is the general contractor. Caydon’s in-house team worked on the interior design. 

This will be one of the first Flying Biscuit locations in the Houston area and in Texas overall. The company opened its first Texas location in Richardson about a year ago, per the release. According to the restaurant’s website, it also has locations coming soon to Dallas and the Memorial City area. The company has 13 Georgia locations open or coming soon, three locations open in North Carolina, one in Florida and one slated to open in South Carolina in early 2019. 

The Flying Biscuit offers southern-inspired breakfast, brunch and lunch options and is generally open from 7 a.m. to 3 p.m. on weekdays and 4 p.m. on weekends at most locations. The Midtown location’s menu will have a “Tex-Mex twist,” per Caydon’s release. 

“As Houston continues to emerge as a world-class city with a rich culinary scene, we are strategically focused on partnering with community-driven staples that will complement our iconic landmark development in the epicenter of Midtown,” Joe Russo, principal of Caydon, said in the release. “Similar to Caydon, The Flying Biscuit strives to build strong ties to its community and deep relationships with their neighbors and friends. We are committed to satisfying the demand of those who live within and will visit the neighborhood.” 

Steakhouse owner's buzzy new Washington Avenue burger joint sets opening dat

en Berg doesn't slow down. Over the last year, the proprietor of B&B Butchers steakhouse has purchased Memorial-area Italian restaurant Carmelo's and hired his brother Daniel as its chef, opened a second B&B in Fort Worth, and is planning an upscale concept called Benjamin for The Star apartment building downtown — all under his growing Berg Hospitality banner. 

In his free time, Berg is opening a new restaurant and patio bar on November 8. His new concept B.B. Lemon describes itself as “an elevated eatery and bar serving classic, straightforward food.” Located across the street from B&B Butchers in the former Caddy Shack space, B.B. Lemon occupies a tidy, 1,900 square feet. The space features a 76-seat dining room, a 22-seat bar, and a spacious, fully landscaped patio. 

“This is a place where I’d want to go and hang out,” said Berg in a statement. “We’ve put a lot of thought into what our customers like. It’s more than just a great menu or ambiance; it’s an experience.”

Taking its name and some of its inspiration from iconic New York City spot J.G. Melon, burgers have pride of place on the menu — a hamburger, cheeseburger, “baconburger,” bacon cheeseburger, and a patty melt are all available. Other options include some of Berg's favorite comfort food dishes from both his roots in New York and his life in Houston: everything from New England clam chowder in a bread bowl and a lobster roll to blue crab beignets, chili, and fish and chips. Not surprisingly, dessert options skew nostalgic; diners may opt for a root beer float, banana pudding, cheesecake, or brownie a la mode (among others). 

Chef Eric Johnson, the husband of B&B's sommelier Lexey Johnson, leads the kitchen. Monique Cioffi-Hernandez makes the jump from Field & Tides to fill the role of beverage director. Cocktails feature riffs on classics, including "B.B." versions of the Manhattan, the mule, and the bellini. A tidy list of wines by-the-glass and some easy drinking beers round out the beverage options. 

“To us, this was about creating a fun, neighborhood spot where there’s something for everyone, but it’s also worth the drive for people who don’t live in the area,” Berg added. “Our team really enjoyed putting together the design and the menus and we hope Houston loves it just as much as we do.”

----

Source: CultureMap Houston

B.B. Lemon; 1809 Washington Avenue; 713-554-1809; Monday through Wednesday 11 am to 12 am; Thursday through Saturday 11 am to 2 am; Sunday 11 am to 10 pm.

Ken Hoffman has the prescription for annoying doctor's office waits

When I moved to Houston, to the Gessner and I-10 area, I discovered a tremendous, secret sale at my local supermarket. At 10 pm, they reduced the price of fried chicken, whatever they had left, to 10 cents a piece. I started setting my biological and digestive alarm clock for 9:50 pm, pedaled to the store, and bought my late dinner and next day’s lunch.

Not thinking clearly, I mentioned this absurd bargain in my little newspaper column. The next night, there was a small crowd at the deli counter, watching the clock tick down to 10 cents, like it was Times Square on New Year’s Eve.

The next night, no more dime chicken. I ruined everything for everybody — mostly myself.

This week, I’ve discovered an even better scheme. At the risk of blowing it again...

I was due for my annual checkup and showed up at the doctor’s office right on time. The waiting room was packed. Uh-oh, this might take forever. I’m not a waiter: I don’t wait at the bar in a restaurant, in the drive-through for a Frosty — or in the lobby for a sex robot.

I sat in the doctor’s waiting room for five minutes, went to the counter and lied, “I just got a call from work, they need me down there right away. Can I reschedule another appointment?” And away I went.

This week, I went back, on time, for my reschedule appointment. Oh no, the waiting room is SRO again. I checked in with the receptionist, already thinking what lie I’ll tell her this time.

The receptionist turned and announced to a nurse, “He's here!" The nurse opened to door and said, “we’re ready for you.”

Huh?

I went into the back, and as the nurse took my blood pressure, I asked, “What just happened?” She said, the doctor told office workers that I was a flight risk. Like a criminal with a passport. Do not let him walk another appointment.

That’s the ticket: turn the tables. Make the doctor wait for you. (Got a feeling I’ll be waiting and waiting and waiting from now on.)

Ken's no-spin zone
Here’s my in-depth, hard-hitting political analysis for 2018:

Have you seen Harris County Judge Ed Emmett’s new political ad, where his grandchildren ask where voters can find Emmett on the ballot, and grandpa surprises the kids with a big box of doughnuts?

The investigative reporter in me had to ask: Where did Emmett get those doughnuts? Answer: River Oaks Donuts on Westheimer. Seems the ad’s producer liked how the box looked on camera. 

I would have gone with Shipley Do-Nuts, home of the fantastic Hoffy Twist, an extra-long cinnamon cruller topped with dark chocolate icing. It’s one of the crown jewels in my collection of fine foods. But I’m still voting for Emmett.

Hands off the baseballs
Here’s what the Astros need to do to avoid another ugly incident of fan interference on balls that should have been homers. Just move the outfield fences in by two feet, or the seats back two feet, so it’s impossible for fans to stick their arms onto the playing field. Baseball is weird. I can’t think of another sport where fans can impact the final score by touching a player or ball in play.

While the Astros are at it, extend the screen farther down the foul lines. At some point, MLB will make it mandatory, so why not be proactive for fan safety? I used to have a jai alai problem when I lived in Florida. Jai alai frontons are totally screened in so the audience doesn’t get smacked with a stray pelota. The view never was an issue, especially when I hit an exacta.

Behind the burger scene
Last week I was dining on a burger (I know, big surprise) at Jax Grill on S. Rice Avenue and thought: “This is pretty terrific, I need to know more. I’ll just ask the owner, Paul Miller.” He also owns the Union Kitchen on Bellaire Boulevard, two blocks from my spring/summer home in West U. (Love the Kitchen’s meatloaf.)

Jax half-pound patty is 80/20 chuck, never frozen, from Ditta Meats in Pasadena. The bun is from Ashcraft bakery in Stafford, delivered fresh daily. The burger is served with sliced tomato, Bibb lettuce, red onion, and dill pickle. MSRP: $5.25.

“All of our burgers are cooked over a live-fire mesquite grill, which burns hot and puts off a great smoke that makes our burgers something special,” Miller says.

Jax Grill has a second location on Shepherd Drive, which adds live music to the menu on weekends.

Source: Houston Culturemap

Houston's best pizzeria fires up new tastes with Memorial outpost opening

Memorial-area pizza fans, rejoice. Your new Pizaro’s has arrived. For too long, fans of Pizaro’s Pizza’s Memorial-area location have been denied the same experience as patrons of the Montrose location. Space limitations at the original outpost prevented the installation of a deck oven that would allow Pizaro’s owners to make the same Detroit and New York-style pies that have transformed the restaurant from Houston’s best Neapolitan-style pizzeria into the city’s best pizzeria — period.

Open quietly since last week, the new Pizaro’s (11177 Katy Fwy.) has enough space (2,500 square feet) to allow for both a deck oven and a wood-burning oven made by Italian firm Forza Forni. Nicole Bean, who owns and operates both locations with her husband, Brad; her father, Bill Hutchinson; and her brother, Matt Hutchinson, couldn’t be more thrilled about her new digs.

“It was the most perfect spot we found,” Bean tells CultureMap. “We probably looked at 15 other spaces. We’ve looked in West U. We looked in Katy, out in Pearland. When this popped up, [we knew] this was it.”

Customers who have been to the Montrose store will recognize the industrial-inspired look with simple wooden tables. Graphics on the wall illustrate the difference between the three styles: Neapolitan (stretchy dough, personal-sized); Detroit (deep dish, rectangular shape); and New York (what most Americans traditionally think of as “pizza”).

“Customers are thrilled,” Bean says. “I had a customer who said he came in for usual potato and mushroom, but [chose] the Detroit instead. [He said] ‘I saw the picture on the wall, and that’s what I had to get.’”

Even the most dedicated customers may not realize Bean is now an award-winning pizzaiolo. She earned the coveted Rising Star award at this year’s Caputo Cup during the recent Pizza & Pasta Northeast trade show. Unlike other awards given for making a specific style of pizza, the Rising Star award goes to someone that conference attendees will be a future leader in the pizza world.

“I’m honored to have it,” Bean says. “I don’t know if I feel like I deserve it. My peers think that I am deserving of it, so I’m very appreciative of that.”

Her brother Matt also earned an award for a pasta he made at one of the event’s competitions. While Pizaro’s doesn’t serve pasta, that could be changing. Bean says she and Hutchinson are contemplating pasta pop-ups to gauge interest in featuring the dish on a regular basis.

And why not? If a bar in the Heights can swing a weekly pasta night, surely Houston’s best pizzeria can figure it out.

---

Source: Houston Culturemap

Pizaro’s Pizza I-10; 11177 Katy Fwy.; 713-485-0530; Monday to Thursday 11 am to 9 pm; Friday and Saturday 11 am to 10 pm.

On game day, take your tailgating to the pro-level

Tailgating has been the only part of football that Owen Daniels didn’t experience.

The former Texans tight end started his career as a high school quarterback nearly 20 years ago. And when you’re winning Super Bowls — as Daniels and the Denver Broncos did in 2015 — there’s not much time for pregaming.

Now that Daniels is happily on the sidelines, he’s got some catching up to do.

Enter Jax Grill owner Paul Miller, whose gospel of tailgating follows a three-tier system.

“There’s just throwing drinks in a cooler. And then you’ve got your fold-out grills,” he says. “But a pro-level tailgate rolls out the smoker and the fryer — the works.”

He and wife Doris Miller definitely qualify as professional-grade. They’ve been Texans season suite holders from the beginning, ever since NRG Stadium opened in 2002.

And though the couple cheers on all of Houston’s sports teams, organizing the pre-party before the Texans take the field is more than just tradition, it’s part of their profession.

“Everyone meets up in the suites’ parking lot,” Paul Miller says. “Last week, I saw a trailer with a huge deck, cornhole, Mega Jenga and that new jumbo flip cup game they sell at Dick’s Sporting Goods.”

Like Daniels, Miller was a student athlete. He doubled up on both the wrestling and football teams at Purdue University. That’s where he gleaned the name for one of his restaurants, The Union Kitchen.

“In Purdue’s basement, the bottom level was the (Union) food hall and we always called that ‘the kitchen,’” he says.

When Miller moved to Houston in 2005, he earned his restaurant chops at McCormick & Schmick’s and Grand Lux Café. He and and his wife opened The Union Kitchen in 2010. In 2015, their company, Gr8 Plate Hospitality, bought the two Jax Grill locations, and they’ve been hauling their trailer between Texas A&M University and NRG Stadium to cater tailgates ever since.

“It’s the largest cocktail party in the world,” Miller says. “I’m amazed at the culture in Texas. People just leave all their stuff out in the parking lot, and when they come back after the game, it’s still there.”

Southern hospitality is the foundation of the Millers’ tailgating strategy. And if you ask them, the cardinal rule of entertaining is never running out.

Naturally, Paul Miller’s solution is a surplus of everything. “People never want to take the last of something. So if you’re going to do it, do it right.”

And because no one wants to work too hard on game day — it’s a party, after all — the Millers recommend pre-batched cocktails that can be poured directly into glasses. That, and ice-cold wine and beer — it’s fail-safe.

Where grub is concerned, heat-and-serve dishes are key. Seasoned hosts prep in advance so they’re not slaving away over a hot stove (er, coals) once guests arrive, which explains why bacon-wrapped sausage, aka voodoo balls, stuffed mushrooms, and Frito Pie macaroni and cheese (winner of Taste of the Texans coveted People’s Choice award) are some of Jax Grill’s most-requested tailgate items. No day-of slicing or dicing required.

Daniels awards the extra point to fare that can be eaten sans utensils.

“Right now, people are into steak and lobster, but you’ve got to have tables and chairs for all of that. It takes away from the actual experience,” he said. “When someone comes up to me with a beer in one hand and food without a plate in the other, that’s goals.”

For Doris Miller, it’s not a proper tailgate without a little sparkle. She purchases the bulk of her Texans décor from Amazon and the Dollar Store, then adds a personal, blinged-out touch with loose stones and a hot-glue gun.

“Everything has to match, from outfit to tabletop,” she says, pointing to her red Kendra Scott earrings, bedazzled football jersey and rhinestone sneakers.

Daniels values atmosphere over aesthetic. “If a stranger can be walking through the parking lot and is handed a cold drink, that’s the kind of tailgate I want to be around — one that’s inclusive.”

But Paul Miller thinks his wife might be right. Details are what separate good tailgates from the great.

“Shade,” he says of his No. 1 tip for a first-class game day. “Always have shade.”

Source: Houston Chronicle

Danton’s gulf coast seafood and steaks announces name change and location change

Danton’s Gulf Coast Seafood and Steaks has been serving some of Houston’s freshest and most delicious Gulf seafood since 2007 at Chelsea Market, 4611 Montrose Boulevard, Houston, Texas.

Early 2019 brings numerous changes for this Houston hotspot including a new location, menu and name: introducing, Eugene’s Gulf Coast Cuisine.

Eugene is the name of the father of Kyle Teas, proprietor of Danton’s Gulf Coast Seafood and Steaks. “Eugene is my father’s name, so our core values will remain the same, but guests can expect refreshing updates,” says Teas.

Danton’s last service will be on December 31, 2018.

Eugene’s Gulf Coast Cuisine is set to debut in early 2019.

Location: Eugene’s Gulf Coast Cuisine will be located at: 1985 Welch Street, which previously housed Mockingbird Bistro.

Dishes: Fan favorites and classic offerings from Danton’s will be available at Eugene’s Gulf Coast Cuisine like: Kyle’s Crab Salad, Shrimp and Grits, Seafood Gumbo and the Debris Sandwich.

Signature cocktails like the Bloody Danton and the Puerto Rican will be served at Eugene’s.

Cuisine is described as "authentic and genuine southern cuisine."

All dishes will be made from scratch. Seafood and steaks will be grilled over a wood burning fire. And there will be an oyster bar.

What originally started as an investment for Teas has morphed into a meaningful and personal endeavor. “I like getting to meet great people through our restaurant. Many of them have become friends that I hunt, fish, golf and play music with,” says Teas. “I look forward to expanding into Eugene’s and creating a concept that our customers resonate with that is even better than before. And yes, there will be an oyster bar!”
 DantonsSeafood.com

Sneak peek: Popular Memorial restaurant sets opening date for stylish new locationN

Never let it be said that Jonathan Levine doesn’t know how to celebrate his birthday. One week after turning 65, the chef-owner of Jonathan’s the Rub will throw open the doors to his second location in the Memorial Green development on October 4.

Over a year in the making, the new Jonathan’s offers many of the dishes found at the Hedwig Village original location in a stylish new setting. The new location also features an expanded beverage program with a wine list created by consultant Shepard Ross (Pax Americana, Glass Wall, etc.), and, for the first time, a full set of spirits with cocktails created by bartender Linda Salinas (Hungry’s, Julep, etc.).

“We have two discernibly different restaurants,” Levine tells CultureMap. “We have one that’s a neighborhood place that people come with bottles from their wine cellars.”

Later, he adds “Noticing the demographics coming here for Dish Society, seems like a little different animal. We think it’ll be a little younger here. We’ve catered to baby boomers. Now we’re going to a younger generation and millennials who will be our base. It’s a different world.”

Those differences become apparent the moment customers enter the restaurant. Whereas the original location evolved over time from a catering business with a couple of tables into taking over its small shopping center, the new Jonathan’s is purpose-built in the heart of a luxury project from development firm Midway. Taking its inspiration from Jonathan’s status as a family-owned business, architecture and design firm Gensler created a space inspired by a home — well, a home that can seat approximately 230 people inside and out. 

Have cocktails in “the den,” which features a marble-topped, 10-seat bar. From there, patrons may choose to dine in the more formal “living room,” which features butcher block tables, or the “sun room,” with large windows that let in lots of natural light. “The study” serves as a 24-seat private dining room complete with multimedia capabilities that should make it a popular place for corporate meetings with businesses in the nearby Energy Corridor. 

Turning to the menu, Levine worked with executive chef Eric Laird (Liberty Kitchen, Ritual) to craft a wide array of options that blends the original location’s most popular dishes with new arrivals designed specifically for the second restaurant. At a time when trendy restaurants might only have 20 items on the menu, Levine is going the other way.

“I’m not interested in a small menu,” he says. “You see the fire in the guys when there’s so many things to learn. They love it. How would you feel cooking eight things over and over? It just doesn’t work for me.”

Regulars will appreciate that favorites like the lobster tacos, dumplings, Hill Country chicken and shrimp, and veal chop marsala are all present and accounted for. Jonathan’s has always served steak and chops, but the new restaurant features an expanded selection sourced from renowned purveyor Meats by Linz. Carnivores will want to sink their teeth into the new veal chop (pictured above) as well as a bone-in ribeye, strip, or filet.

Levine’s trips to Mexico show up in the chicken mole poblano and a tostada topped with mixed-fish ceviche. Tamales will appear on the happy hour menu.

“Sam [Levine’s son] and I went to Merida, Mexico [to learn from] a ceviche guru who taught me eight ceviches in three days,” the chef says. “We ended up with eight great ceviches. Some are fish, some are vegetable. Some are mixed.”

The family feel comes from more than the restaurant’s look. Levine’s daughter Jessica will serve as the new restaurant’s general manager, and Sam will remain with the original location. 

“When I met the waitstaff, I said ‘this is not a corporate joint with tiers and tiers of management,’” Levine recalls. “‘We’re family. We’re going to work it out and take care of each other for a common cause.’”

Putting his kids in charge and hiring Laird to run the kitchen represents the closest Levine will come to stepping back from his day-to-day responsibilities of cooking on the line. He’s more of a culinary director now, responsible for developing ideas and ensuring his standards are maintained at both locations — and of thinking about the next restaurant.

Wait, what? This one isn't even open yet. 

“We have a couple of things we’re plotting,” he says.

Source: Culturemap

Food halls galore: Can downtown Houston handle the latest food service trend

As if Houstonians don’t have enough restaurant options already, another new concept is coming to the Bayou City. But this time, hungry Houstonians will be able to choose from among many options in one place.

By the end of 2019, Houston’s downtown area will have at minimum five operating food halls, which is a concept that’s similar to a food court in a mall or airport but elevated by offering different food options from independent chefs rather than chains. 

The area’s first food hall — Conservatory at 1010 Prairie St. — opened in 2016. By the end of 2018, it will be followed by Bravery Chef Hall at Aris Market Square at 409 Travis St. and Finn Hall inside The Jones on Main at 708 Main St. Next year, two others will follow: Lyric Market at 411 Smith St. inside the Lyric Centre garage as well as Understory at 800 Capitol St. inside the new Capitol Tower. 

“A food hall is taking that same dynamic that we know works: Creating a destination and making it convenient to people by offering a wide variety of products at the same time so that there’s this heightened sense of community — but with a higher level of quality,” said local restaurant consultant Chris Tripoli, owner of A La Carte Restaurant Consulting Group. 

It was only a matter of time before Houston encountered its own food hall craze because the trend has been in full force across a few years. In 2010, there were less than 50 food halls in the U.S., according to the April 2018 report “Food Halls of America” by commercial real estate services company Cushman & Wakefield PLC. By 2015, there were more than 100 operating halls, and by 2020 there will likely be 300. 

Although Houstonians are proud of their city’s culinary reputation, the question remains whether they will flock to five food halls within a six-block radius in downtown. 

“I like that we are getting food halls, but there’s only been Conservatory, and it has had mixed results,” Tripoli said. “And now we have Finn, Lyric, Bravery and Understory, and all will be larger. Having that many food halls with that many tenant spaces available, we might be overserving today’s market.”

Click the following links to read more about each food hall:

• The first: Conservatory

• The incubator: Bravery Chef Hall

• The Art Deco building: Finn Hall

• The artsy market: Lyric Market

• The everything else hall: Understory

However, the odds are in favor of Houston’s fab five: Of the 200 current operating food halls in the U.S., only four permanent projects have closed in the past two years, said Garrick Brown, a national retail real estate analyst who wrote the Cushman & Wakefield food hall report.

To survive, food halls must do high volume of sales because of their size and high investment costs. They also must attract a regular, affluent consumer willing to spend at least $15 per meal a few times a week. 

Enlarge

Garrick Brown is the vice president of Americas head of retail research at Cushman & Wakefield.

COURTESY CUSHMAN & WAKEFIELD

“I do think that there are enough people downtown who will utilize food halls for meals on a regular basis,” said Jonathan Horowitz, who is the former president of the Greater Houston Restaurant Association and currently serves as CEO of Houston-based Legacy Restaurants, which owns Antone's Famous Po’ Boys and The Original Ninfa’s on Navigation. Ninfa’s will be opening a concept inside Understory.

“The one question I have is: Will there be enough evening business that the developers are hoping for?” he said. “And I think that’s just an unknown.” 

Attracting the downtown food hall consumer

Tripoli, Horowitz and other local industry experts expect the five food halls to be busy on weekdays during breakfast and especially lunchtime thanks to the nearly 158,000 people who work downtown. About three-fourths of these workers earn more than $3,333 a month, according to a June report from public agencies Central Houston and Downtown District. 

“It’s a captive audience, obviously, because most of those folks who work in those office buildings don’t want to walk to the parking garage, get in their car and try to drive somewhere else (to eat),” Horowitz said. “You can never say anything is certain, but I don’t see downtown all of a sudden losing all of its workers.” 

However, Brown wasn’t as optimistic — though a majority of the current 200 food halls do survive primarily on daytime business, he said.

“A workforce of about 160,000 could support two food halls,” he said. "It's going to be competitive."

For these five food halls to survive, they need to build an evening and weekend crowd. Local restaurant experts aren’t sure how successful those efforts will be. 

“The key thing for one of these things to work well in downtown Houston is marketing,” said commercial real estate broker David Littwittz of Littwitz Investments Inc. “And the marketing money has to come from the landlord because you have to get people in the door, and — in this case, in Houston — you have to change their thought patterns and explain to them what it is.” 

Food halls will have to persuade office workers to stay in the area after 5 p.m.; sway theatergoers, sports fans and residents to choose a food hall over a full-service restaurant or favorite bar; and convince Houstonians across 655 square miles that the drive, traffic and parking is worth it. But most importantly, these new food halls will need to create a sense of community. 

“Food halls in other cities are successful because they don’t just serve food,” said Greater Houston Restaurant Association Executive Director Melissa Stewart. “They’re a community center.” 

Can 5 food halls survive in downtown Houston?

HBJ asked several retail experts, chefs, developers and food hall operators whether they think Houston's downtown can support five food halls. Here are their answers.

Luckily, downtown is no stranger to change. In the past 15 years, GreenStreet and Discovery Green opened. The METRO-Rail launched. Minute Maid Park, the George R. Brown Convention Center and theater buildings were renovated and expanded. Market Square Park was updated. And several office and residential high-rises were built.

“Everything’s moving downtown. It’s become a bigger city,” said Phi Nguyen, owner of The Pho Spot, a concept inside Conservatory, and The Waffle Bus food truck. He recently moved downtown. “It was dead for so long, but now on Friday and Saturday nights, there’s people everywhere.” 

Several local restaurant experts expressed that there is a demand for more dinner options before theater performances and drinks afterward. With 13,000 seats in the Theater District, many of those attendees need a place to sit down and eat. In fact, a lack of dinner options before a theater performance was the inspiration behind Lyric Center, which is a block away from the Alley Theatre, developer Jonathan Enav said.

What will drive people into food halls at night, Brown said, is evening programs, such as poetry slams, live music and cooking classes, in combination with more residents living within walking distance or a short Uber or Lyft drive away. 

More Houstonians are calling downtown home. The household population in the 2-mile radius of greater downtown Houston is about 67,000, a 30 percent increase since 2000, per Central Houston and Downtown District. These organizations and others are working on growing the downtown area. And with more businesses, families and places for entertainment, there comes the need for more food options. 

“We absolutely need and can support these food halls,” said Angie Bertinot, director of marketing for District Downtown. “I think they will all complement each other, and the clustering will continue to position downtown as a foodie destination.” 

If downtown food halls survive, it will be because they attract more residents and offices. Brown said that in the current amenities’ arms race, many multifamily, office and mixed-use projects want a food hall component with local vendors. Developers often see a halo effect from a food hall in which they’re able to lease space easier and at a higher price in part because of the food options. As such, some developers won’t close a food hall even if it is losing money. 

In particular, tech companies highly desire office space with a food hall component, Brown said, citing Google’s recent purchase of New York City’s famous Chelsea Market and Facebook’s own campus restaurants in Menlo Park, California. 

But four food halls that will open within 12 months and a total of five food halls within six blocks of each other is worrisome, said Scott Taylor Jr., a professor at Conrad N. Hilton College of Hotel and Restaurant Management at the University of Houston. 

“I don’t know if huddling around Main Street is the right thing,” he said. “Five operations is too many. ... Maybe in five or 10 years when more people live downtown.”

Taylor also doubts that attendees at the George R. Brown Convention Center will make the nearly 1-mile trek to Finn Hall, the nearest food hall, between activities. He felt that Discovery Green, with its established green space and many nearby hotels, would have been a better location for a food hall. 

In the next 18 to 24 months, Brown expects to see a wave of food hall closures across the U.S. The ones that shutter will be those that aren’t authentic to the food hall concept as a food destination with local vendors; are inefficient with operations; and are located outside high-density areas.

“I do have concerns in markets where multiple food halls open up in close proximity to one another,” Brown said naming Denver and Miami, which had five open over 18 months, though none of them have closed. “What’s going to be important (for Houston’s downtown food halls) is that they differentiate themselves in meaningful ways from one another.” 

Of the five food halls, experts say Lyric Market has the best chance of survival because it caters to a specific niche market: Theatergoers and an evening crowd. Its market vendors selling fresh goods will also set it apart from the other food halls. 

Experts predict that Bravery Chef Hall will also do well because it will attract true foodies thanks to its chef-driven tenants who are up-and-comers driven to create. Time will tell for Finn Hall and Understory, both of which are from out-of-town operators, though Understory does have an advantage with its five access points to the underground downtown tunnel system along with street access. 

Houston’s food hall future 

Brown and local restaurant consultant Tripoli stressed that food halls aren’t a fad but rather an example of how the food and beverage industry is changing in response to a growing foodie consumer segment, millennials’ desire for experiences over physical items, e-commerce and higher rent. 

“It is not just a short-term trend,” Tripoli said. “This is a trend in food service, whereby developers can use square footage in highly populated area to create much larger variety than they would be able to if they just split (the property) up and put in three or four tenants. It’s a wiser, better use of space.” 

Brown added that the food hall trend is the industry’s sharing-economy model, and it will continue to evolve. 

Similar projects are popping up all over Houston: The 24,000-square-foot Bellaire Food Street in Chinatown, which will bring nine vendors offering Asian cuisine; the redevelopment of the 17-acre Houston Farmer’s Market in Greater Heights; the 3-acre Railway Heights Market near the Memorial Park Golf Course; and a food hall at The Grid in Stafford. 

Overall, food halls are a win for the many parties involved: The developer adds value to his or her property, the operator generates high revenue from alcohol sales, tenants gain exposure in a new market with a low cost of entry and consumers have more dining options. Some restaurants in downtown even see food halls as a boost for their own sales. 

“If anything, the new food halls will be good for business and increase exposure to our two Hearsay locations downtown,” said Zaidi Syed, director of operations for Landmark Houston Hospitality Group, which owns the Hearsay restaurants downtown. “An influx of people will be in the area to dine at the food hall, which will create an opportunity for us to capture their interest for a cocktail or light bite.” 

Regardless, there’s a good chance that not all five food halls will make it, but that’s how the food and beverage industry is, Stewart said. Restaurants close frequently. Luckily for food hall operators, if one tenant doesn’t work or pull in their share of the revenue, contracts are usually set up in a way to quickly get a new concept in.

Stewart, like many others, wants Houstonians to support food halls.

“When we open the five food halls here in town, and if one of them doesn’t succeed in 18 to 24 months, and we are back down to four, that to me is in no way a failure of the concept,” she said. “It’s just how business works sometimes. I think it speaks very well of our continuing food industry here in Houston, and there’s going to be a lot that we can learn from this no matter what things look like in five to 10 years.”

Source: Houston Business Journal

Houston's Top 100 restaurants for 2018 revealed

Dive into this year's Top 100 Restaurants with a virtual banquet of Houston's best dining. There are 17 newcomers to Alison Cook's list, and five returnees have upped their performance after a hiatus.

Two of those newcomers landed in the top 10 tier; and a total of six of them appear in the top 30 ranked restaurants. (The rest of the list appears in alphabetical order.) That's a solid showing that demonstrates the continued vibrance of the city's dining scene, even in the trying year after Hurricane Harvey.

Source: Houston Chronicle

Celebrity chef Jonathan Waxman brewing up all-day cafe in Houston's new 2-story H-E-B

Four prominent New York chefs are opening a coffee shop in Bellaire’s brand new H-E-B. The Roastery unites Jonathan Waxman, Jimmy Bradley, Joey Campanaro, and Jason Giagrande — bringing over 100 years of collective kitchen experience to a group that refers to themselves as “The Four J’s.”

Job postings for the Roastery describe it as “a new quick-service café with a strong coffee program, local coffee roasting operation and a chef-driven menu.” The cafe will use beans roasted by Four J Foods, a company the chefs created that sells sauces, coffee, and tea at H-E-B. Four J touts that it sources all of its coffees from specific farms, which should help ensure the same level of quality from bean to cup that diners find at coffee shops like Blacksmith, Catalina Coffee, and Southside Espresso that are directly affiliated with a local roaster.

The Roastery is located inside the H-E-B but has a separate entrance that's adjacent to the store's. A TABC poster in the window indicates that the cafe has applied for its own beer and wine license. Judging a restaurant's readiness by peeking in the windows is an inexact science, but the build-out looks to be complete. 

Neither The Roastery nor H-E-B have responded to CultureMap’s request for comment about the timing of the opening, but an employee mentioned they're targeting the middle of October. A CultureMap reader discovered a since-deleted webpage that offered a draft version of the menu (see screen shot above). The all-day cafe will likely serve a variety of pastries, breakfast items (avocado toast, quiche), sandwiches, salads, and maybe even bone broth.

Turning to the owners, Waxman constitutes the group’s most prominent name. In the ’80s, his restaurant Jams bought California cuisine to New York City. The chef also won a James Beard Award for Best Chef: New York in 2016 and has appeared on two seasons of Top Chef Masters. His roast chicken is legendary.

Waxman's partners in Four J are less prominent but still very accomplished. Bradley is known for The Red Cat, an almost 20-year-old Mediterranean-influenced restaurant in New York’s Chelsea neighborhood. Campanaro own three establishments, including The Little Owl, an Italian-inspired restaurant in the West Village. Giagrande serves as the company’s CEO; he’s held a variety of roles throughout his career, including serving as the vice president of food service operations for the Starbucks outlets at Barnes & Nobles bookstores.

In scientific terms, that’s an epic shit-ton of culinary talent for any restaurant, particularly a cafe in a grocery store. Hopefully, H-E-B will provide some more information soon. Some secrets are too good to keep.

Source: CultureMap Houston

B&B Butchers Sets New Record-Breaking Donation for Houston Restaurant Weeks

Foodgasm: The Union Kitchen

HOUSTON — A local restaurateur has turned an idea he had in his college days into big business. Grab a plate! Paul Miller takes us from student union to one of the The Union Kitchen's five locations.

"It's global cuisine served with Southern hospitality," Miller says.

For more information on The Union Kitchen check out their website.

Full story" CW39 Houston

Hot dog! There’s a formidable new frank in town

For much of the country, Labor Day spelled the end of the so-called dog days of summer. We're lucky, though: it's always hot here, and dog days are a constant especially if you're talking hot dogs.

And now, thanks to Kenny & Ziggy's New York Delicatessen Restaurants, there's a new hot dog star in town. Owner Ziggy Gruber's restaurants recently introduced a new hot dog (called a frank on the menu) that have the texture and flavor of old school Jewish deli franks.

Gruber didn't simply switch hot dogs, he actually helped create a new wiener made specifically for Kenny & Ziggy's to the deli man's specifications. He did so after he noticed a drop in quality of the franks he had been using for years (we'll not embarrass the well-respected brand).

"Franks have always been a cornerstone of every deli through the decades. There was always a frank grill in front of every store," Gruber said. "I was feeling nostalgic for that, and also not happy with the changes in the franks we had been serving and wanted something better for my customers."

THREE BROTHERS BAKERY: A year after Harvey; lessons learned

So, he fished out an old family recipe for hot dogs and contacted a friend who owns a USDA-certified hot dog factory in New Jersey, which Gruber said is one of the few that has equipment to handle natural casings. The all-beef wiener with natural casing is now available on the menu at both his Kenny & Ziggy's locations.

And it's a beaut. The robust red frank with its bun-defying length sports that unmistakable snap so prized among hot dog aficionados. The flavor is spot-on.

"It's like tasting my childhood," he said.

FRIED CHICKEN REVIVAL: Kenny & Ziggy's kosher, deli-style version

Gruber has lent even more authenticity to his house franks. He has his own proprietary mustards; there's excellent sauerkraut available; and he offers that only-in-New-York pushcart sauce of tomatoes and onions. Fans of Sabrette onion sauce, surely an acquired taste from the streets of the Big Apple, will be delighted by this nostalgic bit of hot dog flair.

The menu at Kenny & Ziggy's offers a number of options with the new, soon-to-be-famous frank: Rubenesque (with corned beef, sauerkraut and Russian dressing); Slaw & Order (with pastrami, mustard and cole slaw); Yoso Dog (avocado, fried onions, chili sauce and chipotle cream); Queso-ra-Sera (wrapped in bacon and topped with pepper jack, avocado, pico, chipotle cream, sour cream and onion rings); and Sweet & Saucy (slathered with the pushcart onion sauce). All dogs come with fries and are priced at $12.95. Believe me, these franks are substantial; it's a meal.

Me? I'll take a simple dog with Gruber's good mustard. And I'm happy because the most delicious dog days have finally arrived.

Kenny & Ziggy's New York Delicatessen Restaurants, 2327 Pos Oak and 5172 Buffalo Speedway; kennyandziggys.com.

Source: Houston Chronicle

Biscuit-obsessed restaurant takes off with Midtown and Memorial locations

Homey Atlanta restaurant chain The Flying Biscuit Cafe is headed for Houston, with two locations in the works, in the prime neighborhoods of Midtown and Memorial City.

The Midtown restaurant will open at 2850 Fannin St., on the ground floor of the Caydon residential high-rise, sure to be a nice amenity for the tenants.

Memorial City's address is 12389 Kingsride Ln., taking over the space previously occupied by Reginelli's Pizzeria.

Flying Biscuit debuted in Atlanta in 1993. Famous for its biscuits and grits, the chain now has locations throughout Georgia, North Carolina, Florida, and Texas, where it made its debut in Richardson in 2017.

And yet it has maintained its quintessential neighborhood spirit, with a focus on Southern-inspired comfort food.

It serves breakfast all day, with options that go beyond bacon and eggs. There are biscuits with eggs and gravy, but also penne pasta with chicken sausage, spinach, mushrooms, and grits; wrap sandwiches; and even a vegan barbecue burrito.

Other tempting breakfast fare includes turkey hash, and flat iron steak with eggs. A breakfast bowl has eggs and fried green tomatoes. There are oatmeal pancakes; omelets; a biscuit Benedict; and a tofu scramble, with red and green peppers, onions, spinach, and mushrooms.

It also offers brunch, lunch, and dinner, with salads, shrimp and grits, biscuit pot pie, turkey pot roast, meatloaf with garlic mashed potatoes, and oven-fried chicken.

Sandwiches include one with pimiento cheese; a fried-green tomato BLT; fish tacos; wraps; and the above-mentioned vegan barbecue burrito with barbecue tofu, collard greens, and mushrooms, folded into a sun-dried tomato tortilla.

Drinks include coffee, chai latte, and a "sledgehammer" combining four shots of espresso with half-and-half.

Source: Culturemap Houston