James Brennan, owner of the popular Downtown watering hole the Side Bar, remembers the day when the owners of Mellos & Sons Produce came to inquire whether he would be interested in opening another club in their nearby warehouse.
“Right away, the manager called me and said, ‘James, there are a couple of guys here who want to know if you’d be interested in leasing a warehouse at the corner of Island and Sixth. And I think you better get over here and talk to them,’ & #8201;” he said.
“So I pulled back my curtain and looked at the building from the window from my 19th floor office on Broadway and I said, ‘Tell them I’ll be right over.’ ”
Last week, about a year after Brennan and his partner, Demien Farrell, met with John Mellos and his son, Matthew, construction began to transform the 87-year-old, 10,000-square-foot, former produce warehouse into a 23,000-square-foot, two-story nightclub that will be named the Stingaree. An August opening is planned.
Brennan and a group of investors, who have formed Sixth & Island Investments, LLC, are putting $4 million into the renovation, which will include removing the roof to add a second-story mezzanine and a rooftop deck. Since the building is on the city of San Diego’s list of historic places, its rustic brick exterior will remain intact.
While the Side Bar caters primarily to a crowd ranging in age from 25 to 35, Brennan said marketing for Stingaree would be aimed at a “diverse crowd” and at drawing corporate functions.
“Right now the only sizable club in Downtown that draws corporate functions, aside from ballrooms, is On Broadway,” he said.
Located in a 30,000-square-foot building at Sixth Avenue and Broadway, On Broadway has a capacity of 1,700 people.
Brennan is unsure of the Stingaree’s capacity, but expects it to be between 1,000 to 1,200 people.
Lots Of Opportunity
David Cohn, who heads the Cohn Restaurant Group, which includes four eateries in the Gaslamp Quarter, said there is a need for another large entertainment venue in Downtown capable of offering enough space for private parties of 1,000 or more.
“There aren’t a lot of places like that, and On Broadway is considered the premium,” Cohn said. “The Stingaree will be well positioned with its proximity to the convention center, large hotels and Petco Park.”
While Brennan won’t reveal plans for the club’s interior, he said the Stingaree , named after the city’s infamous red-light district in operation for almost a decade before the police shut it down in 1912 , will have a restaurant and three bars. The intent is to bring the “buzz and excitement” of clubs in New York and Miami’s South Beach to San Diego, he added.
Creating A Buzz
According to local restaurant consultant Pamela Wischkaemper, who heads Carlsbad-based Pamela Wischkaemper Food Consultant & Public Relations, it’s difficult to create “buzz” in a large restaurant and bar. But dividing a large building into several small spaces can do it.
“You do it with d & #233;cor,” she said. “Traffic is also very important and your food quality is of critical importance.
“Your menu has to show some kind of creativity, and that comes from chefs.”
Brennan said Stingaree’s menu will be “fine dining, but on the casual side,” and that a local chef has been hired, though he couldn’t announce the individual’s name at this time.
Brennan also heads Halcyon Cos. LLC, which he founded in 2003 to specialize in condominium conversions. He formed a group of investors to launch Side Bar and the adjoining restaurant, Ciros Pizzeria, at Market Street and Sixth Avenue to diversify his business interests. Halcyon has three employees. Together, the bar and restaurant have a staff of 35 full- and part-time workers.
“I have a deep bench when it comes to management at the Side Bar and Ciros, and I want to create opportunities for the staff to move up rather than risk losing them,” he said. “It’s getting harder and harder to find good management in this industry.”
John Mellos described a similar motive for wanting to convert the Downtown warehouse into something different. The family’s produce business was moved to Main Street near Barrio Logan in September. And he said his sons, Matthew and Dean, who are part of the firm, were interested in pursuing additional business opportunities.
“What happened is my youngest son (Matthew) had met Brennan and he was impressed with what they were doing at the Side Bar. So he took me there to see it,” Mellos said. “He’s always wanted a restaurant and club, so Dean and Matthew are both partners in the project.
“Sixth Avenue used to be ‘produce row,’ and there’s been a Mellos there since 1917. So I appreciate that Dean and Matthew will be able to be a part of the new history of the district,” Mellos said.
Brennan appreciates being recruited as a tenant, he said, describing a folder that Mellos showed him containing letters of interest from several restaurateurs. The lease rate for the warehouse is $3.20 a square foot for 10 years, with two five-year options, he added.
According to Cohn, that rate is “not high for a nightclub.”
Altogether, Brennan said, there are about 20 private investors in the Stingaree project, many of whom invested in the Side Bar and Ciros, which opened a little more than two years ago.
Brennan said revenue for the Side Bar was $2.9 million last year, with a profit margin of 28 percent. He also said he and his general partners have paid off their investors, with interest.
It’s no wonder.
By 9 p.m. on a recent Saturday, the bar was filled to capacity with 167 customers, and those waiting to get in were lined up outside the door on Market Street and around the corner on Sixth Avenue.
“We’re crowded five nights a week and packed on weekends,” Brennan said. He didn’t say what his projections are for the Stingaree.