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Bennigan's shuts its doors

By Mark Albright, Times Staff Writer
In print: Wednesday, July 30, 2008

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ADVERTISEMENT [SCOTT KEELER | Times] Cheryl Hester of St. Petersburg, peering into the window of the Tyrone restaurant Tuesday, had hoped to get the $4.99 burger special Bennigan’s had e-mailed her about Sunday.

The owners of Bennigan's Grill & Tavern, one of the first of the fern bar chains, and faded industry icon Steak & Ale stunned customers and employees Tuesday by unceremoniously locking the doors and filing for a Chapter 7 liquidation.

Metromedia Restaurant Group closed all 162 company-owned Bennigan's in the United States, while franchisees who own about 138 other restaurants pondered whether to band together to continue on their own.

Plano, Texas-based Metromedia also closed the last 58 of its long-suffering Steak & Ale restaurants, including one in Tampa. Owners of the Bennigan's in Channelside in Tampa, the lone franchised store in the Tampa Bay area, plan to keep operating.

"We perform very well, have great people and a very successful location," said Christian Cook , general manager of the Channelside Bennigan's, owned by Team Irish Inc., which also runs Gallagher's Steak House there.

The sudden shutdown shocked more than 400 employees at nine Tampa Bay area Bennigan's who were tossed without notice into the ranks of the unemployed. While cars filled with lunchtime customers circled the lots in vain, regulars waxed nostalgic about Bennigan's signatures such as broccoli bits, Turkey O'Toole sandwiches and oversized platters of nachos.

Tampa customer David Rivas shared fond memories of working at a Chicago Bennigan's, which was touted as the world's largest.

"On St. Patrick's Day all the bands would come in," he recalled. "It was pretty cool."

Also closed Tuesday was the last Steak & Ale in the bay area at Tampa's WestShore Plaza.

"You could tell by the faces they had a lot of great people who realized their lives had just changed dramatically," said Jay Botsch , manager of WestShore Plaza, who said he has fielded inquiries about the property.

Given Bennigan's and Steak & Ale's performance the past decade, industry experts were not surprised by the closings. But some were saddened at the collapse of what decades ago had been fertile ground for casual restaurant industry executives, who later created such familiar names as Chili's and Tampa-based Outback Steakhouse. Now all mid-priced, sit-down dining chains in the overbuilt industry are fighting the first economic downturn in decades to actually shrink traffic.

Bennigan's going dark, for instance, left the Tyrone area of St. Petersburg with its seventh vacant sit-down restaurant.

"Steak & Ale was truly an industry pioneer that gave us such breakthroughs as the salad bar, but Bennigan's was more a me-too version of TGIFridays and the early Applebees," said Ron Paul , president of Technomic Inc., a Chicago restaurant consultant. "In recent years Bennigan's didn't keep up with the times, stopped opening stores and just did not execute well."

Part of a closely held conglomerate controlled by 93-year-old billionaire John Kluge , Metromedia Restaurants provided clues the ax was about to fall. After six months on the job, CEO Clay Dover quit three weeks ago, citing his bosses' inability to pick a strategic direction. The company, which also owns 400 Ponderosa and Bonanza Restaurants, put 59 restaurants in Florida up for sale in June. GE Capital Solutions said last month the company was in default on its credit lines.

"Normally, a Chapter 7 liquidation means the lender had enough," said Paul.

Many employees learned the news only as they were getting ready for the work day or they arrived at work to find the doors locked.

Store managers learned their fate in a 9 a.m. conference call and didn't have time to call all their workers.

"I'm just numb and dumbfounded," said Kathi Coyle , a St. Pete Beach shift supervisor, who arrived for work only to learn she had no job. "We all just sat there looking at each other, then said goodbye. It was sad."

"My manager was crying on the phone, telling me not to come in," said Courtney Haynes, a host at the 2520 N Dale Mabry store.

"I knew we were having problems, but I didn't know it was this bad," said another host, Tom Cannone. "It's only been the last year we've been struggling."

Times correspondent Sharon Ginn contributed to this report. Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.