The deadline to find a new tenant for Crabby’s Dockside restaurant has been extended another 30 days as Fort Pierce officials continue negotiations with a potential assignee who has submitted a proposal for the property.
Shyanne Harnage, the city’s community and economic development director, told commissioners that the city has made substantial progress with the prospective tenant but still needs financial information before moving forward.
“We have made significant progress in terms of working with the potential assignee. We have met with them. They have submitted an actual proposal that was in line with the previous RFP that was out,” she said. “We are still awaiting the financial data from that potential assignee, which is why we are requesting this additional time.”
If an agreement is reached, the proposed tenant would come before the board for approval as an amendment to the existing lease with Crabby’s.
The restaurant closed unexpectedly earlier this year after the city discovered the leaseholder owed $215,000 in unpaid rent and property taxes, a number which has since risen in the months following.
That history prompted commissioners to keep the financial review in place before approving a new tenant. Commissioner Michael Broderick said the prospective operator’s financial position needs to be thoroughly examined before the city agrees to an assignment.
“Financials are critically important. We're not going to skip that step. I want to review those personally. I know the entire commission does. So I don't have a problem with the 30-day extension, assuming that this is being fast-tracked at this point to get the financials to us and get them in for a meeting to talk about the terms of the assignment,” he said.
City Manager Richard Chess said the prospective tenant plans to renovate the property, while city staff will evaluate whether the company has the financial resources needed to operate the restaurant.
Broderick also raised questions about the specific business entity that would ultimately assume the lease. He said the city needs to know what assets and corporate backing would stand behind the agreement.
“Is the parent company stepping up and guaranteeing this lease or participating in this lease or is it just some shell LLC that was created today that they want to come in and sign a lease for?” he asked. “Any of us could operate that restaurant and just sign a shell LLC today. So I want to see what's actually backing this organization and what's backing the LLC that's actually signing the lease.”
The city also faces a separate question over the money owed under the existing lease. Chess asked commissioners whether they wanted the city to pursue the outstanding debt or potentially waive it as part of the transition to a new tenant.
“Unless you all want to agree to waive the money that's owed and we move forward just with the straight assignment, which will make it easier for us, but we're waiving $317,429. So that's the elephant in the room for us. How do we want to address that?” he asked.
Broderick said his priority is restoring a reliable revenue stream from the property rather than focusing on recovering the previous tenant’s debt.
“We're at risk for all that money. And my motivation would be not to collect the past due, but to move forward with collecting income on a regular basis, moving forward. Whatever the rent structure is per month, it's $15,000, $17,000 a month and real estate tax reimbursement, et cetera,” he said. “Moving forward, I think is much more desirable than worrying about the money that's passed due from a tenant. We're not going to collect it from in all likelihood.”
City officials will use the additional 30 days to continue discussions with the prospective tenant and determine how to handle the outstanding money owed by Crabby’s. The lease assignment is expected to return to commissioners at a future meeting.