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Opera House for sale

MysteryMen said:
Opera House was really popular with Wake students when I was in school, but now literally none of them go there. Not surprised they are having troubles
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where do you get that they are having troubles? The owner is retiring.
 
DeaconCav06 said:
I wonder how long the "long term lease" is and what the terms would be to buy the property outright.
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Yeah, I'm intrigued by this lease option. Monthly rent of ~$2300 sounds like nothing. Although, I assume there would be some additional rent charges, including a percentage of sales.
 
Doubtful on the percentage rent for a local bar.
 
Percentage rent is customary for restaurants, but not bars?
 
DeacHawk said:
IMO, future success depends on some of the development in that part of town. West End Mill Works is great and helps make that area, with Hoots, Tap, Opera House, the Porch, etc. a solid destination for an evening. With development slated for the Chatham Mill a little further up Northwest Blvd, there may be potential for growth. However, if that development feeds into downtown instead, that could be an issue long-term. :noidea:
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That's been the biggest issue for Opera House, at least among Wake students. Uber plus several new bars/restaurants make downtown a much more appealing and feasible option for Wake students than it was five years ago.
 
DDeac08 said:
Percentage rent is customary for restaurants, but not bars?
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For a mom and pop bar in a strip center? No, I wouldn't think percentage rent would be charged. And i wouldn't necessarily call it customary in restaurants either. Common, but not customary.
 
Just wait till I own it, everybody will be back
 
BiffTannen said:
For a mom and pop bar in a strip center? No, I wouldn't think percentage rent would be charged. And i wouldn't necessarily call it customary in restaurants either. Common, but not customary.
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I've never seen percentage rent outside of large multi-tenant retail developments, often full of national chain retail/restaurant anchors. Definitely not common for independent restaurants/bars/etc in older buildings. The entire concept of percentage rent is based on the landlord being able to create natural "draw" for your business due to the other leases surrounding your location.
 
Yeah, you're probably not even going to get percentage rent in a 500,000 sf power center. You might see it in a one-off single-tenant retail outlet, but probably not.
 
I have no experience in these matters but, can someone tell me what the $237,000 buys? I mean you're leasing the space so you're not buying the building, so this buys what, tables ($5,000), chairs ($5,000), 2 pool tables ($10,000), 4 dart boards ($400), a video game ($5,000), already purchased alcohol ($?), glasses ($5,000), and the under the bar fridge/ice machine($10,000). And these are prices for new items, I'd be willing to bet that all of those things, except the booze, are older than I am. I guess there is some value in the name and being an established location, but I really don't get what you are paying for. Any explanation from someone knowledgeable would be appreciated.
 
Yeah, that's pretty much it. He may also own the bar and the refrigerators. You're also buying the rights to the lease and the purchase option, which are probably worth something. The thing is, the current tenant is probably on the hook for the lease for some period of time, whether he sells the business or not, so he needs to get somebody to take over the lease to avoid paying $27,555 a year plus whatever expenses he agreed to, for the rest of his long term lease. He doesn't have the strongest negotiating position.
 
If we buy it, we'll definitely need some flying banner advertising. Anyone know a contact?
 
KEYSERSOZE said:
I have no experience in these matters but, can someone tell me what the $237,000 buys? I mean you're leasing the space so you're not buying the building, so this buys what, tables ($5,000), chairs ($5,000), 2 pool tables ($10,000), 4 dart boards ($400), a video game ($5,000), already purchased alcohol ($?), glasses ($5,000), and the under the bar fridge/ice machine($10,000). And these are prices for new items, I'd be willing to bet that all of those things, except the booze, are older than I am. I guess there is some value in the name and being an established location, but I really don't get what you are paying for. Any explanation from someone knowledgeable would be appreciated.
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I would assume part of the cost is in the transfer of the liquor license.
 
KEYSERSOZE said:
I have no experience in these matters but, can someone tell me what the $237,000 buys? I mean you're leasing the space so you're not buying the building, so this buys what, tables ($5,000), chairs ($5,000), 2 pool tables ($10,000), 4 dart boards ($400), a video game ($5,000), already purchased alcohol ($?), glasses ($5,000), and the under the bar fridge/ice machine($10,000). And these are prices for new items, I'd be willing to bet that all of those things, except the booze, are older than I am. I guess there is some value in the name and being an established location, but I really don't get what you are paying for. Any explanation from someone knowledgeable would be appreciated.
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Most of the value is in the fact that the business is already operating (presumably, at a profit) and has an established brand and customer base. This is called "goodwill" in accounting and valuation terms. When buying an established business, goodwill value is usually calculated by a formula based on the annual cash flow generated by the business.

If the business is not operating at a profit, then it gets sold at fire sale prices and a buyer basically will assume the debt/lease obligations and maybe pay something for the hard assets. Or it goes bust and all that junk gets sold to pay the creditors at pennies on the dollar.
 
So which one of you is going to buy it?
 
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