End Near for Louis' Restaurant -- Since 1960s
|Getting yanked around by landlords is longstanding tradition at Louis'|
And yet, Tom Hontalas will be flipping burgers and cracking eggs tomorrow. A member of his family has been doing the same since 1937.
That being said, Louis' latest existential threat -- while familiar -- may be the worst yet. The restaurant sits on land owned by the Golden Gate National Recreation Area (GGNRA), and is thereby governed by the same regulations as a snack bar in Yellowstone or hot dog-stand in Yosemite. Instead of just re-upping Louis' lease, federal law stipulates a contract for the restaurant site must go out to bid. And if someone outbids the Hontalas family -- goodbye Louis'.
Tom Hontalas said that, last month, the GGNRA led three groups of potential bidders into his restaurant for a walk-through. One group, he adds, brought along an architect, stayed for more than an hour, snapped photos, and took measurements. Hontalas stresses that the petition he's amassing and signature-gathering isn't an effort to "save Louis'." Rather, it's all part of his pending bid package. But the bidding process may be more competitive than landing Louis' famous corner booth.
The restaurant's first landlord was the Sutro family -- which used to own roughly 10 percent of the city, including its extreme northwest corner. After Sutro sold off Sutro Baths, the Cliff House, and Playland by the Sea to George Whitney, the Hontalas family began writing its checks to him. A group set on replacing the decrepit Sutro Baths with housing bought the land in the '60s; Sutro Baths burned in '66. The new owners had told Hontalas' father, Jim, that his restaurant would have to go; he was blocking their future driveway. When the Coastal Commission put the kibosh on housing at the site, Louis' dodged its first bullet.
The National Park Service took over the land in 1973 and told Jim Hontalas that they had the right to come in and boot him off the property at will with 90 days notice. With this albatross of a contract around his neck, he had no luck convincing any bank to let him borrow money for a much-needed remodel. Tom Hontalas speculates his father may have even turned to loan sharks, but he definitely turned up the money. The restaurant was closed for remodeling in 1974 and opened in April of '75. But the family still faced the specter of losing the place on 90 days notice. That was the Hontalas' daily reality for 13 years, until they were given a five-year contract in '88.
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Then, in 1992, the GGNRA asked Tom and his brother, Bill, to review the master plan for the Sutro Historic District. It included the parking lot above Louis' and the park across the street -- but not Louis'. Six thousand postcards delivered to the National Park Service earned the Hontalas brothers a one-year reprieve. That was followed by another, and another. Finally, in 1998, the family decided to put in a bid for a 10-year deal.
It was an expensive proposition. Lawyers' and consultants' fees costs topped $20,000. But the unkindest cut of all came later -- after turning in the bid, the family discovered it was the only bidder (ouch). What's more, a newly minted federal law eliminated the closed bidding process the Hontalas family was working under (double ouch). So the feds ignored the restaurant's bid, and the $20,000 in sunk costs, well, sunk. And, for the last dozen years, the restaurant has been working on a year-to-year lease. Until now. The feds have decided to put a 10-year lease for a casual restaurant at the site up for bid at long last; all entries are due by May 25.
Hontalas wouldn't reveal what he pays per month today, except to reveal that it's a pretty good deal. But he expects it to double -- if he's lucky enough to retain the restaurant. The minimum level for would-be bidders is to pledge $34,000 for the first $800,000 in restaurant gross revenue followed by at least 6.75 percent of all income after that. How far upwards to adjust those figures on his bid is the kind of thing the Hontalas brothers are paying a consultant to advise them on.
By the way -- whomever wins the bidding process also wins the necessity of building a new exit to the restaurant to get it up to code; complying with the Americans With Disabilities act; and remodeling a place that hasn't been redone since '75. And they'll be doing this work to a building that belongs to the government.
While all of Tom Hontalas' adult life has been spent dreading the day the government moves in and potentially takes away the family restaurant, he said the finality of the current bidding process is oddly calming.
"I've had a lot of sleepless nights wondering what's going to happen," he says. "But in a couple of months, we're going to find out."
Photo of Louis' | Rosencruz Sumera, via Panoramio