Sierra Realty Advisors - Company News

Well-known Lincoln Park pub John Barleycorn plans to open a restaurant at a River North site where developer Michael Reschke has dropped a plan for a 235-room boutique hotel. Barleycorn owner Sam Sanchez says he has signed a letter of intent to anchor a new building at the northwest corner of State and Illinois streets. Barleycorn’s two-level, roughly 20,000-square-foot bar and restaurant would be the establishment's fourth location, including one that opened last spring in northwest suburban Schaumburg. Mr. Sanchez says he’s got financing in place for the River North site. So the question is whether the property owners, a group that includes Joseph Beale of Chicago-based Hawthorn Interests LLC, can lease up the remaining 7,000 square feet of retail space in the proposed building and get a construction loan. Mr. Beale, a longtime Chicago developer, didn’t return calls seeking comment. Mr. Sanchez, who has owned Barleycorn since 1992, says he hopes to open the River North outpost in 2010. The site currently is a surface parking lot behind the Rock Bottom Brewery restaurant. “We’re very excited to get this one going,” he says. “What’s not to love about River North? I love the area, and the address: 508 N. State, you couldn’t ask for a better address.” Mr. Reschke, chairman and CEO of Chicago-based Prime Group Inc., had hoped to claim the address for a Gansevoort hotel and a trendy STK steakhouse. He envisioned putting up a 15-story, $95-million building.

Mr. Reschke says he let his contract to buy the site from Mr. Beale’s group lapse a few months ago “for various reasons,” and that his deal with New York-based Gansevoort Hotel Group remains in place and was extended for another year. “There are plenty of other sites that have come on the market in the last six months,” Mr. Reschke says. “We have our eyes set on a couple alternate locations in River North.” The hotel plan’s demise, which comes amid a steep slump for the hospitality industry that’s been particularly hard on high-end hotels, means opportunity for expansion-minded Barleycorn. Mr. Sanchez is planning to have about 9,500 square feet on the first level for Barleycorn’s restaurant, about 11,000 square feet on the second floor for a bar/special events room, and a small rooftop garden area. Mr. Sanchez says he’s been working with brokerage Sierra Realty Advisors for a couple years to find a River North site. Chicago-based Sierra is now looking to lease the property, with a 2,500-square-foot retail space on the first level and just short of 4,500 square feet on the second level that could be combined with the first-level space, according to a Sierra marketing brochure. In addition to more Chicago-area locations, Mr. Sanchez says he’s looking at other cities, including Houston and Austin, Texas, and St. Louis – including one site near the Cardinals’ new Busch Stadium. “We are in the mode of expanding right now,” says Mr. Sanchez, adding that the biggest problem with Barleycorn’s new Schaumburg location has been lack of parking. “We’ve been holding our own in this economy.”

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SOURCE
Crain's Chicago Business
May 20, 2009