Talks Back on Track for Houston’s on Wildflower Property on East Palmetto

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By Dale King  The Pineapple Contributing Writer On-again, off-again talks between Boca Raton city officials and the firm that owns the Houston’s restaurant chain to construct a new restaurant on the former Wildflower nightclub property appear to be back on track. After notifying the city in October that it was pulling out of the restaurant deal at the East Palmetto Park Road site because of a disagreement over taxes and rent, Hillstone Restaurant Group contacted Boca Raton again in a Nov. 24 letter saying it hopes to “restart a dialogue with the city.” The missive didn’t offer an unobstructed road to agreement. “Hillstone’s interest in the property [on the Intracoastal Waterway] continues, but concerns previously expressed over the significant real estate tax estimates continue to be a significant hurdle for Hillstone,” said W. Glenn Viers, vice president and general counsel for the Phoenix-based company. He also wrote the October letter pulling Hillstone out of negotiations. “City staff is in discussion with Hillstone in response to the Nov. 24 letter,” said Chrissy Biagiotti, Boca Raton’s communications and marketing manager. But she said the Wildflower property situation may not end up on a city council agenda until “late February or March.” Viers took Hillstone out of contention for the waterside property in the October letter writing, “The city’s recent request [for] annual rent escalations amounting to several millions more in rent over the life of the lease, together with the significant increases in the property’s taxes, far exceed initial estimates and undermine the economic viability of this project.” In response, City Manager Leif Ahnell said Hillstone’s initial proposal was $500,000 a year in rent plus a 5 percent increase every five years for 20 years along with a percentage of any surplus above the base rent. “We responded [with an offer of] $500,000 base rent plus 2 percent annual escalation,” said Ahnell. “They came back with a proposal for $600,000 base rent, offset by $250,000, which effectively reduced the original figure to $350,000. We said to them, ‘Why not meet us face to face?’ The response to that was their letter,” he said, effectively ending talks. The follow-up letter in November said Hillstone wanted to go back to the bargaining table. The financial offer this time suggested Hillstone would pay: “The greater of 5 percent of the restaurant’s gross sales or the minimum rent of $600,000 per year with 5 percent increases in the minimum rent every five years.” In December 2009, the city purchased the 2.27-acre parcel where the Wildflower nightclub once stood for $7.5 million. It has always been the hope of Boca officials to come up with a use that could help the city recoup its investment. Actually, the purchase had a two-pronged goal: To draw people to and through the downtown and to initiate activity on the waterfront. As proposed, the city said it wanted “a restaurant in a park-like” atmosphere. Hillstone’s October pullout re-opened the floodgates to residents who said they would like to see a park on the Wildflower property rather than a restaurant – even a temporary park with docks for boaters. The city council scuttled the idea of a temporary park in early December when members voted down a park construction proposal as being too expensive. The city council directed Ahnell and staff to consider installing a floating dock. In its November letter, Hillstone said it doesn’t object to a dock if it “does not affect the views of the Intracoastal. Because of the extraordinary water views the property affords, Hillstone’s plans do not include a dock. Hillstone would not, however, object if the city desired to install and maintain one of a mutually agreed-upon design and location along the southern portion of the shoreline.” The cries for a park were so loud that the Greater Boca Raton Chamber of Commerce launched a campaign asking its members to lobby for a restaurant. Putting a dining spot on the property “would generate additional economic impact to our city and help create a sense of place in our emerging downtown,” said Chamber President and CEO Troy McLellan, in an email letter to members. “Alternative uses of the site would not result in the same overall positive outcome.”