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September 9, 2008

Palma shuttered

In case you missed it, MS reader LoveGrove posted this comment yesterday under the Jon Han is o-u-t post:

Landlord changed the locks this weekend. They owe lots of back rent.

Looks like our weird little saga is over -- at least for now.


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Posted by Sam Sessa at 8:00 AM | | Comments (10)
Categories: Bars & Clubs
        

Comments

Sounds like these guys got burned launching the HMS Titanic(s) of clubs.

Assuming they don't file bankruptcy and re-organize, if they can, looks like now they'll have to deal with the justifiably irritated investors and backers with the possible liquidating of the clubs assets if there isn't a buyer for the club as is isn't found. The brief life isn't exactly an incentive.

I really wonder if the location was a factor in Palma's closing. Spots like Mosaic seem to appeal to the same crowd and they're apparently popular enough to stay afloat. Mosaic is also in the Powerplant, which has the benefit of receiving a ton of foot traffic.

Palma/Dubai were up in the middle of nowhere as far as clubs are concerned.

I don't think the club done, just yet. I am sure the investors are trying to get the doors reopened, but a lot of damage has been done.

The negative word of mouth and the rumor mill is churning, never a good sign for a club, especially one the size of Palma.

The guys Han left behind are good people who have been dealt a horrible hand.

As a fellow nightlife columnist, I thought that I would weigh in on the situation with Palma etc...

You can't tell me that a club in a relativly safe prt of town, that is surrounded by booked hotels, a MAJOR tourist attraction and half a dozen colleges in the city limits has a hard time surviving.

I think it all comes down to marketing and ownership.
From what I know, the past owners of clubs like this are not business men. They are usually pumped Russian mafia types and they're in it for the women and the [drugs]. There is no marketing budget, little advertising, and ego high of running a club of this size. Ergo, no biz sense.

On the case of the current owner, he simply didn't know the market. I know he owns a few other clubs, but c'mon...no vermouth? Plastic cups on a dead night?

It's not Baltimore. I refuse to believe that. It can be done.
Red Maple, again from what I know, is not hemorrhaging money and I think it's been there for almost 10 years now. Call it what you want, but it seems that they have backer that know what they're doing.

What I would do with the club? One of two things: make it an after hours annex of Mosiac "The party's far from over ya'll....it's right up the street."
OR fergit the club idea and franchise a Dave and Busters.
If Mosiac has that back gate opened, people could walk right up B-more street to the club and not have to navigate the back streets.
The "Block" is one of the safest streets to walk on in the city.

Jon Han wasn't so much a club owner -- more like the traveling salesman who sold Springfield on building a mono-rail on the Simpsons.

He has already moved onto another city (Philly) where he is convincing another set of investors to open up a mega-club.

JM,

Red Maple is a totally different animal than Palma or Redwood Trust. There isn't a demographic report that I have read (and we have read them all) that shows sustainability for a large, upscale, self-standing nightclub within the city limits of Baltimore.

Crime, homelessness, education, income levels, depreciation, taxes, urban dwellers, public transportation, etc... These are all factors that have to be taken into consideration.

With the cost per square foot that needs to be generated by a space such as Palma, you must market and cater to a crowd that doesn't exist.

Larger clubs in Baltimore are going to have to market to a larger audience. The upscale/dance crowd that doesn’t mind leaving their neighborhood and won’t complain about $10-12 drinks is very small. Problem is, with the larger crowd you must market to, comes many, many problems that in my opinion aren't worth the profits.

Not to mention, you are 30 min away from a city with excellent income levels, lower taxes, greater depreciation residuals, concentrated crime prevention and risk management and lower real estate prices (commercial), and city sponsored incentives to open up nightclubs and restaurants.

It will cost you far less, and you will be able to charge far more, with less static from the government, and less complaints from your customers in Washington, DC.

People don't realize the costs of sound, lighting, decor, permits, insurance, entertainment, marketing, staffing, product overhead, etc... $12 a drink is cheap! Especially when your b/e could be higher than $1k per sq foot, per night.

Take all the above, and add that for the last two years, industry reports consistently show that trends are moving from large scale nightclubs, to more intimate lounge settings.

You don't need a risk taker to open a large club in Baltimore; you need to be an idiot.


M.T. hits us with some knowledge! Mark, where've you been man? And how's that high end bar/club of your own going?

Sam,

Our project is going well. We are renovating a space now in Harbor East. 3,500 indoors with 2,000 sf outdoors (open year round).

We have secured a live entertainment tavern license, but we will be serving small plates. As I mentioned before, drinks are the focus of our model, and they are like no other. No gimmicks, just good drinks. It is very difficult to find a well crafted cocktail, there is currently no bar in Baltimore or Washington, DC that comes close to our drink menu. I could include Philadelphia to that list, but there have been some openings over the summer.

Our menu is being created by Andre Christopher, the former Chef de Cuisine from Japonais in Chicago, and former executive chef of Pops. He has three Michelin stars under his belt from his tenure at Japonais.

We searched everywhere in Baltimore for a location, and finally, the right people came to us. It's still far from over, and like any business deal, things could fall through with little notice.

Harbor East works well for us. We are within two blocks from 7 hotels (by 2009). Including a Four Seasons and a W Hotel.

Within the four surrounding blocks there are 10m sf of residential and office space; over 3,000 hotel rooms; over 4,000 residences; and over 10,000 parking spaces.

Federal Hill/Canton/Downtown averages about $70k income per residence, whereas Harbor East averages around $130k in income per owner-occupied residence. Stats courtesy of BCG.

In my building alone, I have quite a few Orioles and Ravens, as well as an attorney who represents the urinated upon.

I LOVE BARRY

don't tell me it's raining twain, I see the urine running down my leg. lol! good luck with everything.

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About Erik Maza
Erik Maza is a features reporter at the Baltimore Sun. He writes for several sections of the Sun paper and contributes weekly columns on music and nightlife. He also writes and edits the Midnight Sun blog. He often covers entertainment, business, and the business of entertainment. Occasionally, he writes about Four Loko, The Block, the liquor board, and those who practice "simulated sex with a potted palm tree." Before The Sun, he was a reporter at the Miami New Times. He's also written for Miami magazine, the Orlando Sentinel, the Sarasota Herald Tribune and the Gainesville Sun. Got tips? Gripes? Pitches? He's reachable at erik.maza@baltsun.com. Click here to keep up with the dumb music he's listening to.

Midnight Sun covers Baltimore music, live entertainment, and nightlife news. On the blog, you'll find, among other things, concert announcements, breaking news, bars closings and openings, up-to-date coverage of crime in nightlife, new music, round-the-clock coverage of Virgin Mobile FreeFest, handy guides on bars staying open past 2 a.m. on New Year's Eve and those that carry Natty Boh on draft. Recurring features include seven-day nightlife guides, Concert News, guest reviews of bars and concerts, Wednesday Corkboard, and photo galleries, as well as reader-submitted photos. Thanks for reading.
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