It sounds like 41-year-old Harold & Belle’s is planning a few big changes, but naturally it’s going to cost someone a lot of money. The Leimert Park Creole restaurant seeks both an interior remodel and a food trailer to cater at events, while the founder’s grandson hopes to pay off the restaurant’s first mortgage and purchase both the business and the land it sits on. To achieve this vision, a loan of $2,629,000 from the U.S. Department of Housing and Urban Development Department was reportedly approved on Wednesday, and as you can imagine, not everybody thinks the restaurant needs all that money.
Jack Humphreville of City Watch breaks down the math, and though he might fail our food-test when he calls the restaurant “some of the best Creole food outside of New Orleans” (it’s good, but not that good), he appears to know his numbers. Humphreville reports that only 17% of the money will be invested directly in the restaurant’s operations, while the remaining $2,370,000 is being used to pay the restaurant’s existing mortgage , with $1,170,000 going to the current owners.
Since justification for this loan is said to center on “living wage” job development and preservation, the writer looks at the 26 jobs that would be created, in addition to the current 50, and asks, “Do you need 26 new employees to operate and supply the new food truck and service the restaurant’s existing business?” Also, looking at the projected $7,300 annual wages made by a majority of the staff before tips, the writer is hardly convinced a living wage plays a big part in the picture. He also feels the land value may have been exaggerated, implying that the parcel is priced at a 90201-like $6,000,000 an acre.
Humphreville throws out the word “cronyism” as a possible reason jobs are scarce in our city. He is convinced that the public may wind up empty-handed after making the loan if the business bombs, while the sellers are getting the good end of the deal and the buyer is assuming little risk. He concludes, “maybe this is standard operating procedure in the City of Angels where one of the world’s largest and most profitable architectural design firms, Gensler & Associates, was blessed with $1,000,000 gift to finance its move from Santa Monica to downtown Los Angeles.”
Whittling down the proposed improvements at the business to $1,200,000, he thinks he has a way to slash the loan in half and take the loan off the shoulders of the public, while still helping Harold & Belle’s to endure and prosper.
Harold & Belle’s City Financed Buyout … Almost as Good as the Gumbo [City Watch]
