The city has reached a preliminary agreement to lease 12,600 square feet in the basement of Union Station for a new restaurant and nightclub. The lease is with The Arantee Group, one of the owners of 6 Lounge & Restaurant on Meridian Street. The new club would take space in the basement of Union Station along Illinois Street. The space, last occupied by Iron Horse, has been vacant 12 years, said Mary Hauser, an asset manager with Browning Investments. Browning is the listing agent and property manager for the 231,000-square-foot Union Station, which is now 95 percent occupied. The preliminary deal calls for up to $300,000 in landlord improvements and a 10-year lease that averages $10.30 per square foot.
Two years ago, the ATC fined The Arantee Group for four violations at the 6 Lounge related to impermissible alcohol sales and violating restaurant/food services requirements. Dare I ask who owns The Arantee Group? And isn't it about time the City unloaded Union Station and sold it to a private developer?
UPDATE: The Star is reporting that The Arantee Group wants to operate a "private bar and restaurant" in this publicly-owned building. Sound familiar? Jeff Swiatek writes:
A private bar and restaurant may open in the basement of Indianapolis' Union Station.
Operators calling themselves Arantee Group propose to lease 12,600 square feet underneath the grand hall. The space has been vacant since the Iron Horse moved out 12 years ago.
"They want to use it as a private facility" that probably wouldn't open to the public, said Jo Lynn Garing, a spokeswoman for the Indianapolis Bond Bank, which handles leasing in the city-owned station complex.
The city Metropolitan Development Commission is scheduled to vote today on authorizing the bond bank to spend up to $300,000 to renovate the basement space for the new use.Arantee Group's main partner is nightclub operator Ravi Arantee, said Garing.
The historic train station was converted into a festival marketplace in the mid-1980s and has experienced a series of ups and downs. Most of the former retail space is now leased for office use and a banquet hall. Events held this decade include the 2001 World Police and Fire Games.
I'm sure your Lexis/Nexis access will yield you more details than this ... but here's Arantee Group, LLC as listed by the SoS office
ReplyDeleteFind it odd the LLC was formed in Delaware. I thought that Delaware advantage was only for full Corporation entities and not LLC's and Nevada was the place to go for LLC's these days. They do have two DBA's - "6" and "The Beach"
Surely this isn't another one of Bill Mays' companies is it?
What??? $300.000 on landlord improvements...and many of us are driving patrol cars that are up to 8 years old with over 100,000 miles!!!
ReplyDeleteAnd they said we're cutting spending.
This administration has got to be changed
Guess the city is now going into the bar business.
You would bitch and moan if the property sat there empty. $300,000 isnt unreasonable in fixing items since the place has been vacant for 12 years........come on, dont let your hatred for Bart, cloud your vision on this one.........
ReplyDeleteAre they going to CLOSE their current location or open a second NEW bar / restaurant and keep the current location open ?
ReplyDeleteIs the $10 per square foot below - on par - or high with other places at Union Station and other like locations ?
Pike Voter
$10 per SF is about par with other deals in Union Station. A decent bargain downtown, but Union Station's success rate keeps their rent down. It will for a long time, too.
ReplyDeleteThe TI allowance of $300K is not necessarily out of line, depending on: whether the improvement costs being borne by the tenant are equal to or greater than the city's share; if the $300K is a check being written to the tenant or a rent reduction; the tenant's fiscal health via financial statements and/or personal gaurantees; length of lease.
These are the kinds of details Carl Drummer would've been smart to inevstigate before he did the 300 East deal.
I can't do it due to my employment--but any citizen can request a copy of the 300 East and Arantee leases. If anyone does, please post here...the details can be illuminating.
anon 6:09, numerous individuals requested a copy of the 300 lease. There was no lease--even at the time the owners went before the local alcoholic beverage board. Drummer told Abdul he wouldn't sit down and write up a lease until he figured out how much the owners invested in the bar. As I recall, he said the lease rate could range from $10-$20 per sq depending on the investment.
ReplyDeleteHow do they get away with nightclubs and liquor licenses in Union Station, now that there's a school on-premises?
ReplyDeleteThat's had me puzzled since the Pacer's Academy first started.
Anon 7:06, that was one of the complaints lodged against the Ugly Monkey. The school came along long after there were already bars in Union Station
ReplyDeleteEven more proof why paying "your fair share" in taxes is only for sheeple. Corruption is at an all time high in this city. Wish I was an insider who could get these sweet six-figure deals.
ReplyDeleteThe Pacers Academy is a joke for a school anyway. They handpick the students they want and toss them out at the least little reason. If all schools could do that, we would have a remarkable success rate. The per pupil cost at the Pacers Academy would make some of the leases and real estate deals in Union Station look like major money makers for the city.
ReplyDelete10.50 a ft is cheap for downtown space basement or not. Remember that C5 property anywhere in town (needed for a bar) brings a premium. Factor in that the tenant won't be getting a property tax bill and this is a sweet deal for the tenant.
ReplyDeleteAt this rate the city will not recouped until the third year of the lease. What happens if the bar fails? A large percentage of start up bars do. At the very least the tenant should repay the city the 300K.
9:04, you raise a good point on the TI payback.
ReplyDeleteTypically, if a tenant hits a certain sales mark, or leaves, the unamortized portion of the TI should be paid paid.
That's hard to do if you're bankrupt when you close. It just becomes one more unsecured claim, at pennies on the dollar, ifk anything.
TI allowances, with good landlords, are always based on the fiscal strength of the tenant. The TI allowance becomes, in effect, a partnership between landlord and tenant. The business plan and financial reserves are thus extremely important.
As for the $10.50 rent--in Union Station, it's about average. A good lease would also contain a percentage rent clause, whichi would reward the landlrod if the tenant reached certain sales milestones.
AI--has anyone asked good 'ole Carl for a 300 East lately? A signed lease is a condition precedent for a liquor license, and I beleive, under oath, it was indicated there is a lease. God knows what it says, or when it was signed. Maye Carl can store his Corvettes at Bill Mays's house or soemthing.
This is not good government.
From what I understand, owners say they're looking at this for overflow space. The intent is to have space for race weekends and large private parties. As I understand it now, it won't be a public extension of the bar and the current bar/restaurant isn't moving.
ReplyDeleteHonestly, I don't see how anyone can call "corruption" on a lease for previously unused space with improvements thrown in. Any private landlord would do the same.
Well, there's Six and Seven up in Broad Ripple. What are they going to call this one? Five? Eight?
ReplyDelete