Chris Koszyk The owner’s wife, adjusting a floral display, in the dining room.

Start-Up Chronicle

Getting a restaurant off the ground.

Editor’s Note: For more than two years, Bruce Buschel chronicled his experiences creating a restaurant on this blog. In a series of posts this week, Mr. Buschel explains why Southfork Kitchen will not be opening in Bridgehampton, N.Y., this season.

The Powerhouse Brokers and I continued to haggle over commissions and advertising and my asking price: $3.75 million. Too high, they said. Not for me, I said. We can’t sell it at that price, they said. I smiled and nodded. We can rent it, they said. I don’t want to be a landlord. You’ll get money every month, they said. I would prefer to cut and run rather than dragging out the separation. They demanded an exclusive. You can’t sell it and you want an exclusive? Yes, they said, and they wanted it by Tuesday.

This I knew: If I signed, the word on the street would be that Southfork Kitchen was on the block — bailing, failing, whatever. Naturally, if it were going to sell, the right people had to know it was for sale. But it would be disastrous if too many people had that knowledge, and we didn’t sell. Who wants to reserve a table on a sinking ship? I fully expected to reopen come spring. Powerhouse Brokers gave me the weekend to decide. Millions of dollars at stake and one handsome fee and many livelihoods and years of work and I had but three days to make a decision.

Distressed, and unable to leave an irony alone, I called my secret role model, Jerry Della Femina. Who sold your place? New Street Realty, I learned. Never heard of it. In New York City. I called. The firm agreed with the price and understood the delicate nature of the mission. We reached a quick meeting of the minds, if not contract details. Sad adios to Broker Amiga. For all her kindness, she was cut out of the deal. I owe her.

New Street Realty needed a local rep to field inquiries, to show the restaurant, and do the diligence. It picked an office in East Hampton. Serious negotiations started anew with the local brokers. Long and arduous. Innumerable calls to my real estate friend in Florida. Eventually, I had to hire a lawyer to make sure my representatives were my teammates, not opponents. The final deal had more layers than a wedding cake. The one thing we all knew was that March 15 was the deadline; time was needed to prepare the restaurant for the summer deluge, whether for us or for the new owner. Fortunately, our place was prêt-à-porter — anyone could walk in and open to the public within two weeks. Nothing old, nothing blue, nothing borrowed, nothing askew.

The local brokers wanted to plant a for-sale sign on the restaurant lawn, as if people motoring down Sag Harbor Turnpike might see the sign and smack their foreheads: “Geez, maybe I want to buy a restaurant.” Ixnay the ignsay. It would serve only to put patrons on notice, not potential buyers. They would be reading the trades. The local brokers also wanted to list the property for rent. Fixing a hole in the roof in the middle of a Nor’easter was the last thing I wanted to face. No rental unless someone very reliable wanted a very long-term lease. Ixnay the entalray.

The very first call I got was from Broker A. (Remember him from Part 3?) He wanted to know why I had overlooked him.

“I wanted a broker in New York City,” I said.

“You made a big mistake going with another local broker.”

“I went with New Street,” I said, “and they picked a local rep.”

“You shouldn’t have given them an exclusive.”

“You can still sell it,” I said.

He insulted a variety of people, including his telephone counterpart, and reiterated his only real question: “Why didn’t you sign with me?”

“This is why,” I said.

“Why?”

“You talk too much. You scare me.”

The first couple of months on the market were, as predicted, slow. A phone call here, a visitation there. No Christmas presents. In January, a New York group that owned a string of vegetarian restaurants came for a visit. That was about it. A well-known operator made an appointment and then canceled. A famous chef said he was too busy to buy a restaurant until September and wanted an appointment for the fall. I asked if his restaurant took reservations seven months in advance. Neither do we, I said.

One local chef came back twice and brought his wife and kids. With years of experience, a spotless record and a good reputation in all facets of hospitality, he reeked of stability. That he loved the restaurant was apparent: the garden beds, the clean kitchen, the exposed steel beam, the upstairs apartment. It all fit his philosophy. To him, I would rent. He disappeared.

Meanwhile, February flew by like the short month it is. March came in like a lamb chop, raw and boney. A chef from New York was interested in renting. He brought a Wall Street investor to the restaurant. We all sat down and talked numbers, trying to design a scheme that would sidestep a deep fiscal hole before he even began. It is a common pitfall and worth skirting.

The local brokers called me two days later.

“The Wall Street guy has a question.”

“Shoot.”

“If he pays you the entire key fee up front and in cash, would you lower the monthly rent?”

“That’s not unreasonable,” I said.

“He wants to pay you a couple hundred thousand dollars in cash.”

“Cash is good.”

“Hundred-dollar bills.”

“O.K.”

“And then you won’t report it.”

“Wait. What?”

“You don’t report it.”

“Is this a sting? Is Mr. Wall Street going to wear a wire or a hidden camera? Does he work for Curbed Hamptons?”

“People think restaurants are a cash business,” the local broker said.

“Not that it matters, but 95 percent of our business is credit cards.”

“I know.”

“Are you endorsing this deal?” I asked.

“I am just a conduit. I pass along information is all.”

“Pass along this information: We launder napkins at the restaurant, not money.”

“So you are going to report it?”

“Of course I am. I can’t break federal, state and maybe local laws to save some money in taxes. You know what kind of food they serve in prison?”

That deal vanished the next day.

But that local chef I liked, the one who reeked of stability, showed up again. His name is Todd Jacobs, and he brought his lawyer. They were getting their Long Island ducks in order. Mr. Jacobs wanted to rent, not buy.

He had been executive chef in three well-known places over the previous 25 years. It was March 15. Spring was on the wing. They were serious. But time was seriously running out. Chef Joe needed to know. He was cooking in Brooklyn and auditioning for a television show and about to fill his plate.

Me? I was breaking plates and pacing. Staff members were calling to find out their schedule — from Montego Bay, Jamaica; from Jamaica, N.Y.; from Ewa Beach, Hawaii. I told them everything I knew and promised a sterling recommendation with the new operator if there were to be a new operator, which I seriously doubted. I remained fully convinced that we would reopen Southfork Kitchen in May.

Friday: Gone Fishin’

Article source: http://boss.blogs.nytimes.com/2013/06/27/my-restaurant-adventure-can-i-pay-with-cash/?partner=rss&emc=rss