Foundation Building

The new Sacramento restaurant that almost wasn’t

Back Article Nov 1, 2013 By Douglas Curley

It took a year of arduous twists and turns, but Matt Sin and Krissy White finally got what they wanted. The business partners and co-owners of the just-opened Foundation Restaurant & Bar at Fourth and L streets in downtown Sacramento have an eatery of their own. It’s a sweet relief to be sure, because the story behind it is rather unsavory.

Sin and White, while both young (42 and 31), are hospitality veterans. They spent the past six years working together at Fourth Street Bar & Grille, a long-time landmark in Sacramento’s downtown fabric. Sin worked as general manager and night bartender, White as the daytime barkeep. And it was during this joint tenure that the discussion of owning a business began.

“After the lunch rush, when the bar was empty, Matt and I would often sit down and talk about how we’d like to do our own bar and grill,” White says. “We lamented about how we would do things differently.”

On October 1, the now-shuttered Fourth Street Bar & Grille officially reopened as Foundation Restaurant & Bar. An easy transition, an outsider might think, from former owner and employer to a couple of long-valued employees. The truth paints a different picture.

To fulfill their vision, Sin and White would endure more than 12 months of on-again, off-again negotiations with Ron Fleming, the owner of Fourth Street Bar & Grille; and the landlord of 455 Capitol Mall, the building in which the business resides. At times, they would alternatively feel strung along, disrespected and at one point outright “screwed.”

“Krissy and I continued our afternoon discussions, and one day Ron came up and told us he was thinking about selling the business. While we were uncertain how serious he was, all of a sudden our afternoon discussions took on a whole new level of seriousness,” Sin says.

An initial sales discussion began with Fleming in early August, 2012. Over the course of the next three months, the duo crunched numbers. Fleming responded. And talks got underway. Or so they thought.

In early November, 2012, Fleming informed the pair that Fourth Street’s lease was up and that the landlord, Bill Dawson of Monterey & Great Pacific Corp. wanted him out.

“Something happened between Fleming and the landlord. He wanted a new tenant,” Sin says. “So I thought, we can simply take it over.”

As it turned out, Fleming was actively pursuing another buyer. At the same time, Dawson himself had also hired a broker to find a buyer for the restaurant. To complicate the issue further, Sin says he was told by Fleming that Dawson wanted a new tenant with no connections to Fourth Street.

Frustration was rapidly sinking in. Sin and White poured into their business plan and, along with personal savings, secured a loan from Bank of the West.

“Officials from the bank were regular patrons of the restaurant. They wanted the restaurant to stay, and they wanted the two of us to own it. So they agreed to take a chance on us,” Sin says.

With business plan and finances in place, they handed a proposal to Fleming and — they thought — to Dawson as well. According to Jennifer Hayer, administrator and tenant relations manager at 455 Capitol Mall, Dawson and Monterey & Great Pacific Corp. were not made aware of the Sin/White interest until after the untimely death of the buyer Fleming was pursuing. That was in January 2013. Unaware of the circumstances leading to the deal’s failure, Sin and White offered Fleming a new deal — one nearly identical to the deal he had agreed to with the other party.

Fleming said it wasn’t that easy to transition from one party to the other.

“On the day I was set to sign the final papers on the sale of Fourth Street, I got the word that the individual who was going to buy it from me had just killed himself,” Fleming says. “It was a shock to say the least and really set back my plans for the sale.”

From February to June, Sin and White negotiated with Fleming while he carried out a good-faith, month-to-month lease with Dawson. After months of fruitless go-round, Fleming told them no. Period.

“We spent $7,000 on attorney fees to make the purchase happen. And then, finally, he said, ‘I don’t want to sell it to you,’” Sin says. He basically said, ‘screw you.’”

Fleming says they weren’t “seeing eye-to-eye on the terms of the deal.”

“As far as I was concerned,” he says, “the continued aggravation was not worth the low price I was going to get.”

So he retained the liquor license and the name Fourth Street Bar & Grille. He sold off everything in the space not attached to wall or floor. Virtually overnight, the downtown favorite watering hole evaporated.

Relentless, Sin and White “went directly to the landlord and told him Ron was unwilling to work with us,” Sin says. “So he said, ‘Lets open up something else. Something brand new.”

According to Hayer, the tenant manager, Dawson and his partners were surprised by the Sin/White offer.

“Prior to the tragic ending of the first proposal, we had no knowledge of the interest of Matt and Krissy,” Hayer says. “When their proposal was submitted, the group was very supportive of making the deal work. Many other tenants in the building made it known that they wanted it to work for the two of them. Looking back now, it’s a great success story.”

In July, with the creation of Sin White LLC, Foundation Restaurant & Bar was born. But in keeping with the story, this was not an easy creation. Along with the liquor license, Fleming took everything but the built-in bar, walk-in refrigerators and exterior awnings.

“So there was a fresh canvas for us to build on,” White says. “We were left with no furniture, no kitchen equipment and no light fixtures.”

Sin and White turned their attention to acquiring the necessary licenses, equipment and furnishings. The twosome scoured Northern California for deals, attending restaurant equipment auctions and scanning the Internet. At the same time, there was much work to be done on the facility itself.

“Our budget was very tight, so much of that work we did ourselves,” Sin says.

When it came to staffing, Sin and White brought back much of the old Fourth Street team, including Chef Jeramie Smith.

“Our regulars all had their favorite servers, and everybody loved the food Jeramie had been preparing for 14 years,” Sin says. “Our business plan is banking on the return of our regulars. We need their patronage to stay afloat the first several months.”

So much so, according to White, that Foundation’s business model is based on that of the previous restaurant.

“We know margins are very tight in this business. Our plan projects that if we maintain the operation model of Fourth Street at its lowest previous level, we can still make it,” she says. “If we even do 10 percent better, we’ll be in much better shape than it was doing over its last year of operation.”

Throughout its soft opening in October, Sin and White received growing support from their sound base of Fourth Street friends and regulars. They’re also receiving the attention of a fresh new group of downtown enthusiasts — especially from those with an eye on the coming of a downtown arena.

Potentially just a block from Foundation, the new arena could be a major boon to the fledgling partnership. But after what they’ve been through the past year, they’re nowhere near ready to count that as an ensured blessing.

“The last so-called second coming to the downtown business district is still a big hole in the ground across the street,” Sin says, referring to the remnants of the still-undeveloped Saca Towers project. “Lots of people were counting on that project to make their business plans work. Most of them are now long gone.”

Adds White, “Until I see a couple Kings sitting at our bar after a game, I won’t be counting on them to make our business thrive.”

For his part, Fleming says he is fielding opportunities to put his equipment and liquor license back in play. He expects to complete a deal by the end of November and open at a new Sacramento location soon after the first of the year.


 

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