July 10, 2009
Huntington Mexican Restaurant Pioneer Files for Bankruptcy Protection
Chili Willi’s Will Remain Open; SBA, Empowerment Zone Owed Secured Loans
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – When describing a modest beginning, Chili Willi’s had one. Their first restaurant was wedged in a tiny spot to the west of the Cinema Theatre ( 1019 Fourth Avenue, where Hank’s is now). The restaurant outgrew the small space rapidly, prompting a move to 841 Fourth Avenue, which quickly doubled in size and became a downtown fixture for more than about 20 years.
Ron Smith, owner and former president of the Huntington Urban Renewal Authority, guided the development of the then dubbed ‘super-block’ property that after 30 years became Pullman Square. Prior to the culmination of the project, one hurdle rested at the corner of Third Avenue and Tenth Street --- Smith’s principal Mexican food competitor, Chi Chi’s. Ironically, Chi Chi’s (owned by Prandium Corp.) was sold to HURA for $1.75 million dollars on March 28, 2003, then, resold to the Transit Authority and Metropolitan Partners. Following a food poisoning outbreak at one of the other restaurants in the Chi Chi chain, the eateries could not recover and closed.
Interestingly, once the Pullman project had been consummated , Smith elected to re-located his booming Mexican eatery… but not in or around Pullman. Instead, he selected a former cell phone location at 1315 Fourth Avenue, with free parking and only three blocks from the gates of Old Main.
When Smith announced Thursday, July 9, 2009, that Chili Willi’s had filed for bankruptcy reorganization, he emphasized that the restaurant would remain open and the annual Chili fest would continue. According to the court filing, the company borrowed $1.267 million to refurbish the 1315 Fourth Avenue structure and acquire equipment and furnishings. The company has liabilities of about $1 million dollars.
According to court documents obtained by HNN, the Masa Development , LLC Balance Sheet as of June 30, 2009, reveals long term liabilities as a $743,681.14 note payable to the SBA, a $218,132.32 note payable to Empowerment Zone and a $60,096.55 note payable (as) Zone Loan #2, which are the Total Long Term Liabilities of $1,021,910.11
Smith in a published interview blamed the restructuring on the economy, stating the restaurant was profitable from 2005 to 2007, then took a 20 percent nosedive. The restaurant hopes to emerge from bankruptcy protection in a few months after reorganizing mortgage and capital debts.
The court documents state the restaurant’s circumstances as follows: “The operation was quite successful for most of its 20 odd years of existence. It had always operated out of rental spaces in downtown H. All of its equipment and furnishings were unencumbered until 2004-2005. In 2004 with the encouragement of local business and community leaders, Mr S decided to relocate and expand his business. He purchased real property in the name of MASA, constructed a building, furnished and equipped it to meet the needs of the restaurant. The expanded seating and serving capacity of the new facility was calculated to comfortably retire the $ borrowed for the new building and equipment. The total amount of money borrowed to open the new facility was $1,267,000. From 2005 through 2007 the restaurant operated profitably and had sufficient gross income to pay all of its obligations including the new secured debt. During 2008 and 2009 there has been a drastic reduction in gross revenues in large part due to the faltering economy. The decline has reached approximately 20% and has reached a point that the secured debt cannot be sustained.”
Although observers often questioned the decision not to locate at or near Pullman, Mexican food has not been a success at the lifestyle center. Twice, Moe’s Southwest Grill closed -- unable to pay the rent. A revamped version, Don Amigos, operated in the Moe’s location, but it also closed May 4, 2009.
The Mexican trail does not end there for Pullman. In September 2004, Margaritaville Bar and Grill was announced as a future tenant. It did not materialize.
Although Chili Willi’s pioneered non-Taco Bell Mexican styled food in Huntington, the restaurant did not remain without competition following Chi Chi’s closure. Rio Grande opened at 914 Fourth Avenue and later added a second location at 2595 Fifth Avenue. Flapjacks. 1451 Third Avenue, partnered with the Tenampa chain to become a combination breakfast and Mexican eatery. Additional Tenampa locations are in Lavalette (South Tenampa), 14th Street West (West Tenampa) and Milton (East Tenampa).
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Huntington Mexican Restaurant Pioneer Files for Bankruptcy Protection
Chili Willi’s Will Remain Open; SBA, Empowerment Zone Owed Secured Loans
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – When describing a modest beginning, Chili Willi’s had one. Their first restaurant was wedged in a tiny spot to the west of the Cinema Theatre ( 1019 Fourth Avenue, where Hank’s is now). The restaurant outgrew the small space rapidly, prompting a move to 841 Fourth Avenue, which quickly doubled in size and became a downtown fixture for more than about 20 years.
Ron Smith, owner and former president of the Huntington Urban Renewal Authority, guided the development of the then dubbed ‘super-block’ property that after 30 years became Pullman Square. Prior to the culmination of the project, one hurdle rested at the corner of Third Avenue and Tenth Street --- Smith’s principal Mexican food competitor, Chi Chi’s. Ironically, Chi Chi’s (owned by Prandium Corp.) was sold to HURA for $1.75 million dollars on March 28, 2003, then, resold to the Transit Authority and Metropolitan Partners. Following a food poisoning outbreak at one of the other restaurants in the Chi Chi chain, the eateries could not recover and closed.
Interestingly, once the Pullman project had been consummated , Smith elected to re-located his booming Mexican eatery… but not in or around Pullman. Instead, he selected a former cell phone location at 1315 Fourth Avenue, with free parking and only three blocks from the gates of Old Main.
When Smith announced Thursday, July 9, 2009, that Chili Willi’s had filed for bankruptcy reorganization, he emphasized that the restaurant would remain open and the annual Chili fest would continue. According to the court filing, the company borrowed $1.267 million to refurbish the 1315 Fourth Avenue structure and acquire equipment and furnishings. The company has liabilities of about $1 million dollars.
According to court documents obtained by HNN, the Masa Development , LLC Balance Sheet as of June 30, 2009, reveals long term liabilities as a $743,681.14 note payable to the SBA, a $218,132.32 note payable to Empowerment Zone and a $60,096.55 note payable (as) Zone Loan #2, which are the Total Long Term Liabilities of $1,021,910.11
Smith in a published interview blamed the restructuring on the economy, stating the restaurant was profitable from 2005 to 2007, then took a 20 percent nosedive. The restaurant hopes to emerge from bankruptcy protection in a few months after reorganizing mortgage and capital debts.
The court documents state the restaurant’s circumstances as follows: “The operation was quite successful for most of its 20 odd years of existence. It had always operated out of rental spaces in downtown H. All of its equipment and furnishings were unencumbered until 2004-2005. In 2004 with the encouragement of local business and community leaders, Mr S decided to relocate and expand his business. He purchased real property in the name of MASA, constructed a building, furnished and equipped it to meet the needs of the restaurant. The expanded seating and serving capacity of the new facility was calculated to comfortably retire the $ borrowed for the new building and equipment. The total amount of money borrowed to open the new facility was $1,267,000. From 2005 through 2007 the restaurant operated profitably and had sufficient gross income to pay all of its obligations including the new secured debt. During 2008 and 2009 there has been a drastic reduction in gross revenues in large part due to the faltering economy. The decline has reached approximately 20% and has reached a point that the secured debt cannot be sustained.”
Although observers often questioned the decision not to locate at or near Pullman, Mexican food has not been a success at the lifestyle center. Twice, Moe’s Southwest Grill closed -- unable to pay the rent. A revamped version, Don Amigos, operated in the Moe’s location, but it also closed May 4, 2009.
The Mexican trail does not end there for Pullman. In September 2004, Margaritaville Bar and Grill was announced as a future tenant. It did not materialize.
Although Chili Willi’s pioneered non-Taco Bell Mexican styled food in Huntington, the restaurant did not remain without competition following Chi Chi’s closure. Rio Grande opened at 914 Fourth Avenue and later added a second location at 2595 Fifth Avenue. Flapjacks. 1451 Third Avenue, partnered with the Tenampa chain to become a combination breakfast and Mexican eatery. Additional Tenampa locations are in Lavalette (South Tenampa), 14th Street West (West Tenampa) and Milton (East Tenampa).
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