August 31, 2010

Depot Square Steakhouse shuts its doors

The restaurant closed Friday, unannounced.

Union Leader Correspondent
DERRY – Word that Depot Square Steakhouse abruptly closed its doors Friday was still settling in yesterday around town, and the sinking feeling was unanimous.
“We were shocked,” said Tami Brunette, an 11-year employee of C & K Restaurant that sits just a few doors down from the steak house.
“We heard they just closed up, no notice. They were cutting back their hours recently, but we didn't see it coming. People have been talking about it all day,” Brunette said. “The thing is, there are too many restaurants in this town. We have enough pizza places, nail salons and tattoo parlors. Why don't they bring in some kind of business that actually has employees that need to go out and eat every day? “ Brunette said. “How about an office building?”
Yesterday Stu Arnett, hired last year to help boost economic development in both the TIF district and the downtown, said he had heard nothing official prior to the restaurant's closing.
“It's probably a sign of the continuing low spending by consumers, and maybe some of the competition in town – T-Bones, Halligans and other franchises – were a factor,” Arnett said.
Attempts by the Union Leader yesterday to reach restaurant owner Jane Tuerck by phone and at her other business, Janie's Uncommon Cafe in Londonderry, were unsuccessful.
Tureck launched Depot Square in 2002 to much fanfare with business partner Tim Frost in a deal that was brokered by the Derry Economic Development Corporation.
Under the agreement, the town sold the 119-year-old train station to the DEDC for $150,000. The DEDC gave the town a one dollar down payment for the property and then charged Tuerck and Frost monthly rent under a three-year finance agreement. Due to the restaurant's immediate success, they were able to pay off the loan a year ahead of schedule.
However, getting the decrepit train depot up to speed turned out to be a costly endeavor, amounting to about half a million dollars in repair and renovation costs in the end.
Arnett said without knowing the particulars of the restaurant's financial situation, it's possible that debt incurred to upgrade and maintain the place became overwhelming once the economy soured.
A few weeks ago another downtown business, Scrapbook Island, also closed its doors without warning.
When everyone has discretionary money, some of those high fixed costs associated with running a business are more manageable,” Arnett said. “Between the steak house and the scrapbook store, it seems to be a warning sign that we need to take a hard look at what's going on downtown. We need to open the lines of communication with downtown business owners. Maybe if we'd had an early warning, something could have been worked out.”
That is precisely what the town has been aiming to do, by forming a Downtown Committee about a year ago to revitalize the area. Signs of progress have been slow and steady, including a proposed farmers market that was fast tracked and launched in July. The market has brought some new life – and foot traffic – back to the downtown.
But the trickle down effect hasn't been enough, said Bud Evans, who runs the family-owned Derry Feed & Supply Co. just across the street from the old train depot.
“It helps for a while. We go like gangbusters, and things always die down around Halloween, no matter what,” Evans said. “It's like when Halligan Tavern opened. We here in the downtown sort of glom onto the success of others and hope that it helps sustain us all. In the same way, when you hear about a business folding, it's like a death in the family. We're like an unofficial team here in the downtown,” said Evans.
Yesterday, Councilor Janet Fairbanks said given the number of vacancies on Broadway, the town should have already taken more aggressive steps to connect with downtown business owners.
She also said that she has noticed Tuerck's Londonderry-based business, a breakfast and lunch spot, seems to be thriving.
“I know she's there every day, and that recently they closed the Depot for lunch. I'm disappointed. I don't know why the local business community can't get some kind of promotions on the town's cable channel, maybe a spotlight of each business so people know what we've got here,” Fairbanks said.
She said studies have shown that more than a third of every $100 spent locally recirculates in the local economy, which is key to every town's survival these days.
“If we lose our downtown, in my mind, we have nothing that allows us to compete with other towns,” Fairbanks said.
Tom Hankins, who owns Bachmann Florist in the downtown with his wife, Mary, said he's engaged with the Downtown Committee and in favor of a merchants association. He said what's wrong with the downtown is not a single problem with a simple solution.
We have the Opera House, which was beautifully restored, but they hardly have productions that can draw crowds because they feel the parking is not adequate. So there is a potential way to bring people into town to spend money at restaurants that's not happening,” Hankins said. “And that's just one example. We also have landlord problems.”
He cited a stretch of empty retail spaces across the street from the steakhouse where several businesses have recently fled – some just relocating to new places in town, and another, the Blackberry Bakery, which moved up the road to Londonderry.
“Now they have a lower rent in Londonderry and more parking,” Bachmann said.
Downtown Committee member Mike Gendron said he heard rumblings of the steakhouse's demise early last week, which were confirmed by an employee of the restaurant Friday.
“Yes, the economy has hurt people's pocketbooks. They aren't going out for meals anymore. And the fact that the Depot minimized its hours recently made it difficult for someone like me to know when they were open,” Gendron said. “Add to that the success of Janie's breakfast place, where they're probably making better money with a better turn around, and it's not hard to figure out what happened.”
He said this turn of events makes a strong case for rallying the downtown merchants.
“Merchants alone can't save the downtown. It will take help from our elected officials.We need to create a marketing campaign for our downtown,” Gendron said. “I won't let the Depot Steakhouse deter me from making our downtown great. It's a viable location; it just needs the right amount of marketing and redevelopment to make it a place people want to go to. This is not the end of the world. It's just a bump in the road.”

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