Wednesday, May 15, 2013

Blue Fish Kitchen & Bar to purchase former Tuscan Grille property in Downtown Manistee

Blue Fish Kitchen & Bar to purchase former Tuscan Grille property in Downtown Manistee
MANISTEE – One of Downtown Manistee’s most significant historic commercial properties will soon have a new owner, breathing new life into this anchor building on River Street. The Blue Fish Kitchen, LLC is set to close on the property on Tuesday May 15, and will immediately begin work to rehabilitate the building with the goal of opening their new full-service restaurant – The Blue Fish Kitchen & Bar – before the end of June.
“This is the culmination of nine months of hard work, and I couldn’t be more pleased,” says Travis Alden, the Director of Manistee’s Main Street Downtown Development Authority (MSDDA). “Redeveloping this property was the #1 goal for our organization for this fiscal year. The positive impact it will have on the downtown district will be significant.”
The property – known as many different names including the historic Winkler Block, the old Lighthouse Brewery and the former Tuscan Grille – is located at 312 River Street. The Victorian-era building consists of 18,000 square feet on three floors and has been vacant since late 2008 and became bank-owned in mid-2009.
The former Tuscan Grille property in January 2013.
There had been a number of interested parties over the years, but no purchase agreements were ever reached. According to Alden, the longer the building sat unoccupied, the more difficult it would be for a buyer to come in and open a business there, due to deterioration of the building.
“We identified the property as a major catalyst for downtown, and really had to get proactive to get a project in there,” reflects Jeff Reau, Chair of the MSDDA. “Once we had our market data, we knew we could make a convincing case for redevelopment.”
The MSDDA, in conjunction with the Michigan Main Street Center, completed a comprehensive market analysis for Downtown Manistee in April of 2012. The analysis showed that based on the year-round population and demographics of Manistee’s local trade area, there was approximately $12.5 million leaving Manistee annually in the “eating & drinking” category.
“What shows in that analysis as leakage really indicates a market opportunity for a business,” explains Alden. “When we began actively looking to recruit a destination-type restaurant to our downtown, being able to make the case that those kind of dollars are right here, not including part-time residents or tourism, makes a compelling case to locate here.”
It was during a Mayor’s Exchange visit to Big Rapids in July 2012 that Alden first made contact with Connie Freiberg, co-owner and Executive Chef at the Blue Cow Café, a successful restaurant which has been open for five years. Subsequent conversations sparked her interest in Manistee enough that she and Chuck Frieberg – her husband and restaurant co-owner – came over to check out the building.
“We had just recently been discussing the ‘next step’ for our business, and this provided a phenomenal opportunity for expansion,” says Connie, who will be extremely hands-on in Manistee during the early life of the restaurant. “We fell in love with the Tuscan Grille building and knew we had to figure out a way to make it work.”
The listing price of $650,000 at the time was a significant barrier, largely due to the fact that a great deal of investment would have to go into rehabilitating the property before the restaurant could open. According to an analysis of the building that the MSDDA commissioned earlier in 2012, over $250,000 would need to be spent just to get the building ready to open its doors. “And that didn’t include normal business start-up expenses, such as fixtures, staffing, inventory, marketing, etc.” notes Reau.
Enter the Signature Building Acquisition Grant program. The MSDDA quickly began working with the Freibergs on a grant program available through the Michigan Economic Development Corporation (MEDC) specifically meant to assist with acquisition of ‘signature’ properties in traditional downtowns.
“It’s for those ‘White Elephant’ properties that that are very challenging to make work without some type of assistance,” Alden says. “This project is perfectly aligned with the goals of the Signature Building grant program, and it was just what we needed to make the project fly.”
After months of cost estimating, paperwork, due diligence, business plan development and a lengthy multi-part application, a grant of $330,000 was awarded. The grant cannot be more than 75% of the appraised value or purchase price, whichever is less. The price had been negotiated down to $600,000, including all equipment, fixtures and the liquor license.
“The grant amount is based on job creation. The Blue Fish project will create 22 full time-equivalent positions, many of which are managerial or skilled positions, like chefs,” says Alden. “The owner is also required to match the grant award at least dollar for dollar and put that into building rehabilitation. That is certainly the case here, with over $350,000 anticipated in interior and exterior improvements.”
Designer rendering of the future exterior look of the Blue Fish Kitchen & Bar
Chuck Freiberg is quick to emphasize the importance of the grant program to the Blue Fish project. “If not for the Signature Building grant, we simply would not have been able to move our project forward,” he says. “The numbers just wouldn’t work. But the MEDC grant, coupled with the support we’ve received from the Manistee Main Street DDA in the form of a local façade grant and a small short-term construction loan, has enabled us to make the commitment to Manistee.”
Collaboration has been a constant theme throughout this project, from the MSDDA working with the seller and listing agents to cooperating with the City of Manistee on the grant application itself. Officially the City was the applicant for the grant and has finalized a development agreement with the Blue Fish Kitchen, LLC for delivery of the terms and requirements of the grant.
“The City of Manistee and the MSDDA have a long history of partnering together to improve the downtown and the entire community,” says Mitch Deisch, Manistee City Manager. “The cooperation that lead to filing the Signature Building Grant application to assist the Blue Fish Kitchen is a great example of two organizations understanding the common goal and work together to achieve it.”
Kathy Morin, Executive Director of the Alliance for Economic Success, further emphasizes the importance of collaboration in today’s economic development landscape. “This is a shining example of several partners working together for the common goal of expanding the economic vitality of not only

Downtown Manistee, but the community as a whole,” she says. This collaborative redevelopment signifies to the community, existing business owners, and to aspiring entrepreneurs that Manistee is a great environment for investment.”
The Freibergs are eager to take ownership of the property and get to work. “We’ve got all our ducks in a row and are ready to start swinging hammers immediately,” says Chuck. “Our schedule is ambitious but we’re confident that we will be open in time for the Manistee National Forest Festival in early July.”
“Manistee has been great to us so far,” Connie adds. “We’re looking forward to bringing a fantastic dining experience to Manistee and being part of the downtown revitalization we see gaining momentum. It’s exciting!”
There will be a brief ceremony and photo-op to commemorate the closing at 312 River Street on Tuesday, May 15, 2013 at 12:00noon. All media is invited to attend.
The Mission of the Manistee Main Street Downtown Development Authority is to foster the development and promotion of an identifiable and attractive downtown area that will strengthen business and a sense of community ownership.

©2013 Manistee Main Street DDA | 11 Cypress St. Manistee, MI 49660

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