Cava Staff Put on Protective Notice :( Could be closed in 2 weeks!

Seaneh

Really bad news for Galway's food scene, Cava, after 7 years, looks like it might close down in 2 weeks time. Feel really sorry for everyone at Eat Galway and the 28 staff at Cava.

Official notice from JP and Drigin on the Cava facebook page:

Owners Jp McMahon and Drigin Gaffey were forced today to give protective notice to their 28 staff at Cava Spanish Restaurant after notice was served by landlord earlier this week.

The owners cited issues regarding the lease as the determining factor for this action. Jp McMahon said, “in spite of the overwhelming popularity of the restaurant, we have struggled with our high rent over the last number of years. We are still hopeful to reach a resolution”.

Other restaurants owned by the couple under the company name Cava Ltd, the Michelin-starred Aniar and Eat @ Massimo are unaffected by this notice

.

from Cava's Facebook


I really hope they can reach an agreement with the landlord and the jobs and business can be saved, it's one of the most popular restaurants in the city! Hopefully the landlord sees sense!

L'prof

Nooo, I love Cava!!! Travelling at the moment, so I won't even have a chance to have one last meal there

baldbear

I wonder who the landlord is? Cava must be making decent money. It sounds like the landlord is playing hardball regarding rent price and is calling Cavas bluff. A deal has to be done for all those employees.

Mr_A

Hopefully if a deal cannot be done in the current premises then another can be found.

beardybrewer

Mr_A wrote: »

Hopefully if a deal cannot be done in the current premises then another can be found.

I remember hoping that for Sheridans on the Docks. Another perfectly popular spot closed due to a dispute with the landlord.

Playboy

Landlords will rather its empty than lower the rent unfortunately. All about the value of the property if the banks are involved

ted2767

Jesus I'm very upset to hear this.
Haven't been there in a while as I have moved away from Galway but I never had a bad meal/snack there and I ate there a lot.
Fingers crossed they can resolve it favorably.

jimmymal

will be disappointed if cavas goes, love going in there but can rarely afford it.
hopefully they can come to some sort of agreement with the landlord.

witnessrenegade

newkie wrote: »

I remember hoping that for Sheridans on the Docks. Another perfectly popular spot closed due to a dispute with the landlord.

I thought that closed because in the rent agreement they were meant to keep the license for an early morning bar up to date because if it wasn't kept up to date you couldn't ask for a new one. The people renting the place let it run out, landlord found out and kicked them out

Robbo

witnessrenegade wrote: »

I thought that closed because in the rent agreement they were meant to keep the license for an early morning bar up to date because if it wasn't kept up to date you couldn't ask for a new one. The people renting the place let it run out, landlord found out and kicked them out

Bingo, breach of covenant on the part of the tenant.

cfeeneyinterior

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

flynnlives

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

well since Ireland only has upwardly only commercial rents i fail to see how they can get it reduced!

happyoutscan

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

Their rent down there isn't anywhere near 'damn all' I'm afraid. Can you also clarify how you come to the conclusion that they make a 'fortune' down there?

Playboy

Commercial rents in Galway city centre are criminal... only multinational generic brands will be able to afford it soon and Galway will look like a carbon copy of every other uk town.

jimbobaloobob

running a business in ireland isnt straight forward, i sympathise with these guys and their situation.
Its easy to open a business but the amount of legislation and hoops to jump to are just unreal.
Rent isnt the only prob businesses have, by the time you take in rates, insurance, wages etc alot of plates have to arrive on tables to keep it viable.

Seaneh

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

Their rent has always been insane and now its going up. Food, insurance and staff costs have all raised since they opened 7 years ago while their rent has been raised, not reduced, despite their ever climbing costs and narrowing margins.

As ever, the law is an ass abd upward only rent reviews are destroying viable businesses in this city and all over the country.

McTigs

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

oh please, whoever the landlord is for a building in that location, it's most likely some old galway family who certainly won't be losing their home over a rent reduction/not enforcing an increase.

high rents are strangling small business all over this town. landlords are being very shortsighted

Iwannahurl

What's the floor area of Cava compared to Aniar?

If Cava closes, is there any likelihood that Aniar will move a few doors down?

GerardKeating

flynnlives wrote: »

well since Ireland only has upwardly only commercial rents i fail to see how they can get it reduced!

Actually new Upward only rents clauses are illegal, but pre-existing still stand, but they can be broken, some retailers are gonig into "administration" to break them, Peats did it.

cfeeneyinterior

Old galway owners, they had children who inherit. Buy a house based on a guaranteed income from a lease. Of course they could loose their house. Landlords are the same as u and I, they are not an upper class or something. 28 staff, sounds like they need to trim the fat.

I dont think landlords are short sighted at all, its the guy who signs the lease that has the problem

Unrealistic

cfeeneyinterior wrote: »

Old galway owners, they had children who inherit. Buy a house based on a guaranteed income from a lease. Of course they could loose their house. Landlords are the same as u and I, they are not an upper class or something. 28 staff, sounds like they need to trim the fat.

I dont think landlords are short sighted at all, its the guy who signs the lease that has the problem

So as well as knowing the building owners and their personal situation you are an expert on the restaurant business and you know how many of those 28 staff are full-time; how many are part-time; the average number of hours the part-timers work and the standard staffing levels for a restaurant of that category? It must be wonderful to be so knowledgeable.

cfeeneyinterior

Sorry, I may be typing in the wrong tone of voice. People always jump on the landlord without knowing the particular landlord or the actions of the tenant.. . apologies fir my know it all tone,

nuac

I don't know anything about Cava's situation but I do know that a lot of businesses with upward only rent reviews are in difficulties.

Many landlords would like to be able to reduce the rent to keep a good tenants in t hese difficult times, but usually the landlord's bank or lending institution won't allow it.

Fg/Labour promised pre-election to deal with UORRs. They didn't, citing an opinion from the AG.

The government should be asked to get a second opinion on this important issue. A solution there might save jobs in other small businesses

LowOdour

Wonder how quickly this all came about? I follow JP on twitter and see he and the wife were in the UK, posting some lovely pics of the grub they were tasting. It was only a couple of days after that the news was announced. Ate in Cava just before xmas, it was nice but would have liked the chance to go back at a better time. Shame, those guys have been good for galway...hope Aniar keeps going for them

joeKel73

Playboy wrote: »

Commercial rents in Galway city centre are criminal... only multinational generic brands will be able to afford it soon and Galway will look like a carbon copy of every other uk town.

FYP

Unrealistic

Unrealistic wrote: »

cfeeneyinterior wrote: »

Old galway owners, they had children who inherit. Buy a house based on a guaranteed income from a lease. Of course they could loose their house. Landlords are the same as u and I, they are not an upper class or something. 28 staff, sounds like they need to trim the fat.

I dont think landlords are short sighted at all, its the guy who signs the lease that has the problem

So as well as knowing the building owners and their personal situation you are an expert on the restaurant business and you know how many of those 28 staff are full-time; how many are part-time; the average number of hours the part-timers work and the standard staffing levels for a restaurant of that category? It must be wonderful to be so knowledgeable.

cfeeneyinterior wrote: »

Sorry, I may be typing in the wrong tone of voice. People always jump on the landlord without knowing the particular landlord or the actions of the tenant.. . apologies fir my know it all tone,

In that case I apologise for directing sarcasm in your direction in response to your earlier post. But I think it's probably clear that complaining about people judging the landlord without knowing the full story, while at the same time passing judgement on the tenant while clearly not knowing the full story, kind of weakened the argument.

I think there are a couple of reasons why people would instinctively be more sympathetic to the tenant's position in a situation like this.

1) All else being equal a premises is going to worth more to an incumbent tenant than an alternative premises and it will be worth more to the incumbent tenant than it would be to a new tenant. A new tenant will only be willing to pay the market rate for a premises because they can pick and choose without any sunk costs. But an incumbent tenant will have to factor in the disruption of moving; lost business, moving costs, redecorating costs, advertising cost to promote awareness of a new location etc. So an incumbent tenant will normally be willing to pay a premium over the market rent in order to stay put and avoid these costs/disruption. So if a tenant is threatening to pull the plug then, either they believe they are paying well over market rent such that the savings would be worth the disruption of moving, or they are playing a very high stakes game of chicken.

2) You don't have to have studied economics or hold strong political positions to understand that there is a difference between a rent taker and a wealth creator. Most people will instinctively feel more supportive to the latter. The way you've described this situation we're talking about a classic rent taker who has done nothing productive to earn the money they are taking out of the business. If they inherited the premises then they haven't even created the wealth to construct/purchase it and just sit back and enjoy a flow of income that depends on good fortune rather than hard work. Nothing wrong with that but it is naturally viewed as less admirable than getting your hands dirty and earning money the hard way. The restaurant operators are the only wealth creators in this equation and their hard work has to feed both themselves and the landlord. They are the only ones actually contributing to growing the local economy and as such are bound to be looked on more favourably.

fishy fishy

newkie wrote: »

I remember hoping that for Sheridans on the Docks. Another perfectly popular spot closed due to a dispute with the landlord.

you should look into this and you will realize the landlord was right.

fishy fishy

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

Do you really think so? I would say the rents are just as high as in town - after all, its a very lively area - probably more popular than "the latin quarter". no such thing as "damn all" rent I'm afraid.

Seaneh

They signed the original lease 7 years ago at the height of the economic boom.

Their rent was massive.

Gambas

The 'bad landlord' narrative is a bit childish.

Every business, particularly pubs, cafes and restaurants that wants to trot out this line will find a sympathetic audience it seems.

Personally I think Cava is obscenely overpriced, like the Black Cat and pretty much any tapas restaurant in Ireland it seems. Whether that is a result of buying into an expensive lease at the height of the boom I don't know.

Regarding UORR, there's no such thing as a free lunch, and one way or the other there will be negative consequences for the economy, either through tennants going out of business or more large holes appearing in financial institutions from reduced rental incomes.

Mrs OBumble

I don't know the inner details of this situation. (Although I've only been here since 2007, and I think I have a vague memory of Cava opening sometime since then - could be mistaken though.)

However anyone who thinks that landlords can just sit back and watch the cash flow in has clearly never managed property.

During the worst recession, when companies just weren't hiring for my kind of IT job, I did a lot of temping gigs. Looking back, almost all of them involved some sort of property management - not the sexy up-front development, but the boring long-haul operations / maintenance in some way or another. (Issing parking permits, reception for shared offices, admin for a housing association, filing for a property-lender, etc). These people would not have needed me if they did not have things to do. And they most certainly would not have been hiring if the work could have been left un-done.

Unrealistic

Mrs OBumble wrote: »

I don't know the inner details of this situation. (Although I've only been here since 2007, and I think I have a vague memory of Cava opening sometime since then - could be mistaken though.)

However anyone who thinks that landlords can just sit back and watch the cash flow in has clearly never managed property.

During the worst recession, when companies just weren't hiring for my kind of IT job, I did a lot of temping gigs. Looking back, almost all of them involved some sort of property management - not the sexy up-front development, but the boring long-haul operations / maintenance in some way or another. (Issing parking permits, reception for shared offices, admin for a housing association, filing for a property-lender, etc). These people would not have needed me if they did not have things to do. And they most certainly would not have been hiring if the work could have been left un-done.

My own comments have been coming from the perspective of professional experience in this area as well and, while I don't disagree with what you are saying, I think it is only of limited relevance to this example. Sure managing a residential development is hands on and running a shared office compex is a business that has more in common with the tenants in this example than the landlord. I think it's fair to say that the type of restaurant lease in place for Cava or any similar business in Galway is going to require minimum day to day involvement by the landlord.

wonder88

The was some hipster place in Dublin, "Shebeen Chic" ?, that had the same complaint. The did not want to pay the rent and the landlord wanted them out. I remember the staff had a sit-in for a while, and they got a lot of media attention for some time as well, but I am certain that the business man left the premises. As someone who has an indirect involvement in a hospitality business that rents its premises on a short enough lease I understand a lot of the problems that the renter faces.
Hopefully rents both commercial and residential might come down to sustainable levels in Ireland soon, and we might then then have a better society in which to do business and live in. What is very sad, and indeed fairly nasty to see, is the tendency of business owners to use their workers (often on modest pay) as a bargaining chip in their dealings with their landlord.

Utopia Parkway

cfeeneyinterior wrote: »

I'd love to know the rent they are paying down there. I'll bet its damn all and they are trying to get it even lower at the 5 year break/review.
They make a fortune there already, some tenants can be right asses too, not paying rent etc. What if it was a family member who owned the building and if they didnt get the rent owed, they would loose their home. Happening all over ireland folks. That building would be filled in no time by someone else, busy area of town now, rents are on the up down there I'd say.

Believe me. Very few restaurants make a "fortune".

People see a relatively busy restaurant and assume it's a goldmine. What they don't see is that a restaurant is very expensive to operate once you take in all the overheads and running costs.

Ruben Remus

I really hope this is resolved. I went to Cava for a 'special occasion' meal last Friday night and had no idea this stuff was going on behind the scenes. The service was as friendly, and the food as delicious, as ever.

JohnCleary

wonder88 wrote: »

Hopefully rents both commercial and residential might come down to sustainable levels in Ireland soon

I can tell you one thing for certain and that is residential rents in Galway City will not be coming down in 2013. (The same could be probably said for the rest of the country, but I will only speak on an area I have experience of) Maybe in the long run when credit becomes available again for people to purchase units we will see rents come down, but at the minute, demand for (decent) residential units in Galway City is at an all time high

WesternNight

They've just confirmed...

Cava will close on the 25th of January. We want to thank all our customers, staff and suppliers who have made the last five years possible.

https://www.facebook.com/CavaTapasBar/posts/10151282031807949

McTigs

This is a real shame. A lovely place to eat, a big loss to the area.

Hopefully they can relocate.

Also, and i don't know the details but, IF this is as a result of stubborn landlord greed then i hope it sends out a message. Business can't survive in 2013 paying 2007 type rent.

Do we want a vibrant town that can thrive and grow into the future, or do we want to slowly strangle ourselves for a few extra short term pence?

Stench Blossoms

So sad to hear this.

Doubt there's any chance of getting a table between now and then.

beeintheknow

McTigs wrote: »

This is a real shame. A lovely place to eat, a big loss to the area.

Hopefully they can relocate.

Also, and i don't know the details but, IF this is as a result of stubborn landlord greed then i hope it sends out a message. Business can't survive in 2013 paying 2007 type rent.

Do we want a vibrant town that can thrive and grow into the future, or do we want to slowly strangle ourselves for a few extra short term pence?

Perhaps the tenants were being greedy?

Seaneh

beeintheknow wrote: »

Perhaps the tenants were being greedy?

Yeah those greedy tenants, not wanting to pay more than their already very high rent despite the fact that the country is in the **** economically, their overheads are rising every day and they employ 28 people.

*shakes fist*

McTigs

beeintheknow wrote: »

Perhaps the tenants were being greedy?

I doubt it

They are restaurateurs, it's what they do and now if they want to do it they have to find a new location and go to all the very considerable direct and associated costs and effort to open again. It's the absolute last thing they would want to do and if they could have been viable on the landlords terms they would have stayed and paid.

Clearly they couldn't

Unrealistic

beeintheknow wrote: »

Perhaps the tenants were being greedy?

It's very hard to draw that conclusion at this stage. If it was possible to pay the rent being asked and still make money then, if the tenants were being greedy, you would expect them to just grit their teeth, pay the new rent and get on with it. That fact that they are pulling the plug suggests that is not the case.

beeintheknow

Unrealistic wrote: »

It's very hard to draw that conclusion at this stage. If it was possible to pay the rent being asked and still make money then, if the tenants were being greedy, you would expect them to just grit their teeth, pay the new rent and get on with it. That fact that they are pulling the plug suggests that is not the case.

Well pretty much everyone on this thread seems to have jumped to the conclusion that the landlord was being greedy.

Unrealistic

beeintheknow wrote: »

Well pretty much everyone on this thread seems to have jumped to the conclusion that the landlord was being greedy.

With very good reason because at this stage that is what the evidence available suggests. When you've got (arguably) the most successful restaurateurs in Galway voting with their feet and saying they cannot run a successful business at that premises at the rent being asked then the obvious conclusion is that the rent being asked is higher than the market can bear. Whether it is the landlord making that call or whether, as someone suggested earlier, it is the landlord's bank is the only real mystery at this stage.

McTigs

beeintheknow wrote: »

Well pretty much everyone on this thread seems to have jumped to the conclusion that the landlord was being greedy.

I wouldn't say "jumped" to the conclusion.

But in these instances, the tennant is the one with a lot more to lose by the negotiations not working out. They lose their business and the staff lose their jobs will have to to massive expence and effort to start again in a new location hopefully bringing some goodwill with them. For a landlord to find a new tennant isn't easy but not like starting a new business in a new location.

People draw the conclusion that the tennants would really have done all they could to keep with the landlords terms but eventually had to make the ****e decision no one wants to make.

yer man!

Did the same thing happen with the previous tenant? Pasta paradiso, it was one of my favourite places in town and quite busy but closed very suddenly and never set up again.

dilallio

One of the issues particular to Galway is that commercial landlords do not have to pay any portion of commercial rates for unoccupied properties.

Dublin, Limerick, Cork, and Waterford all bill landlords up to 50% of commercial rates on unoccupied properties. This encourages landlords to let out property, as well as reducing rates for other businesses.

More info here...

El_Dangeroso

beeintheknow wrote: »

Perhaps the tenants were being greedy?

I think this answers your question, from their facebook page:

To all those sending us positive messages of hope and resolution: thank you. To all those who have posted/sent us aggressive and abusive messages accusing us of being somehow "anti-landlord", spreading rumors to up business, or even blaming others for our present misfortune: please stop, as they do no one any good. We bear no ill will to anyone, especially landlords in this current economic climate. Our situation is our situation and we are not trying to pigeon hole the entire country into a situation of tenant vs. landlord. We have done what we believe is ethical and correct after receiving notice to vacate the premises. We owe this to our staff and our customers. I am not interested in the blame game. Just the facts of the matter and how they can (if they can) be resolved. Nowhere in our statement or on any of our social media pages have we "vilified" the landlords of Ireland, who too have to run business' as we have to run ours. It is simply a question of accounting, of profit and loss, and how to stay in business in this current country where we find ourselves.

I wasn't the biggest fan of Cava recently as I felt their consistency went down big time, but I am really sorry to see them go, they basically single-handedly made that side of town the restaurant mecca it now is. Very sad for the staff and will leave a big hole in that street, which if it weren't for restaurants would be very dead indeed.

Mrs OBumble

McTigs wrote: »

But in these instances, the tennant is the one with a lot more to lose by the negotiations not working out. They lose their business and the staff lose their jobs will have to to massive expence and effort to start again in a new location hopefully bringing some goodwill with them. For a landlord to find a new tennant isn't easy but not like starting a new business in a new location.

People draw the conclusion that the tennants would really have done all they could to keep with the landlords terms but eventually had to make the ****e decision no one wants to make.

Simple business decision really. Happens to places all over town, all the time. Supply vs demand.

Remember that these are restauranters with considerable experience in setting up new locations: they've done it twice in the last five years, and I'm sure they'll do it again.

Whats more, social media means that if they set up in a new location, Cava II will be as busy as the first version in no time at all.

The real losers are, of course, the staff. But hospitality is like that: jobs tend to come and go all the time.

StonedRaider

beeintheknow wrote: »

Well pretty much everyone on this thread seems to have jumped to the conclusion that the landlord was being greedy.

do you know what I know?

Anyway..never good to see a thread like this.