Richbrau Brewery owner Michael T. Byrne said his Shockoe Slip restaurant collapsed under the weight of the recession.
For 17 years he ran the restaurant, pub and microbrewery out of four connecting buildings that took up nearly 40,000 square feet of space in the 1200 block of East Cary Street.
Last week he padlocked the front doors and on Friday he filed for Chapter 7 bankruptcy protection in the U.S. Bankruptcy Court. A Chapter 7 filing means the business and any inventory will be liquidated under the direction of a court-appointed trustee.
The filing listed assets of $150,739.59 and liabilities of $222,656.86. SunTrust Bank is listed as the largest creditor, owed $97,159.73 on a term loan and $29,256.58 on a line of credit, according to court documents.
The bulk of the assets are listed as $125,000 in furniture, including computers and pool tables; $3,500 in brewery supplies; and $10,000 in food, liquor and beer.
Byrne said the last two years have been particularly difficult for a variety of recessionary reasons.
“I’ve been through three recessions,” Byrne said. “This is a completely different animal. Everyone is freaked out.”
He said fewer people are working downtown because of job cuts and companies closing or leaving the area. Many who do have jobs are fearful and eat out less, he said.
“You can only go down that road of not making money for so long,” Byrne said.
He said lunch business was down more than 30 percent and the biggest reason is there aren’t as many people on the streets downtown as there used to be.
“The issue for downtown has been that dwindling sales has been an ongoing trend,” Byrne said. “It doesn’t have the infrastructure to move forward during times that are this tough.”
Byrne said he took steps to try to keep the business alive. He closed his Tap House Grill in October to focus on saving Richbrau. The Tap House was a restaurant in the same cluster of buildings that he had opened in 2002.
Prior to that he spent money on renovations to Richbrau, including installing new TV sets, and brought in a new chef.
Asked what he will do now, Byrne said he plans to stay in Richmond and hinted that he might have other employment possibilities.
“I’m actively engaged with different potential opportunities and not all are in the restaurant business.”
Richbrau Brewery’s departure leaves a gaping hole in Shockoe Slip and sent ripples through the business district.
“It’s kind of sad. It was a Richmond staple,” said Jennie Stuart, a barrista at Shockoe Espresso and Roastery, at 104 Shockoe Slip.
Shockoe Espresso Manager Ryan Wirt said Byrne bought coffee beans from the shop that he used in brewing his Shockoe Espresso Stout.
“He was one of the forefront guys in the Slip,” Wirt said of Byrne. “I don’t know what to say. I’m in shock.”
That was the general reaction among merchants.
“There’s an emotional impact too because he was very active in standing up for business owners,” said Kelly Justice, owner of Fountain Bookstore, at 1312 E. Cary St.
Justice said Shockoe Slip merchants, including Byrne, would get together on Fridays and discuss the state of the neighborhood.
While there is no formal merchants association, she said Byrne was the unofficial leader.
The other concern is the lights are now out in one of the core businesses there.
“It’s pretty much half a block of empty space,” Justice said. “That’s bad for the neighborhood. That’s got to hurt.”
Andrea Capece, who owns LaGrotta restaurant, said the sudden departure “was kind of a shock for everyone.”
She said Byrne had eaten dinner at LaGrotta a couple of weeks ago and didn’t mention anything about closing.
“Seeing a business closed doesn’t give a good impression,” Capece said. “Hopefully, it won’t affect us much.”
Rachel Grove, the marketing director at the Tobacco Company, said, “We loved having him as a neighbor.”
She is hopeful another restaurant takes that space, even though that would be a competitor, Grove said.
Grove, like other merchants, hates seeing the empty space across Cary Street.
“The big question now is, ‘What’s next?’”
Richbrau’s top unsecured creditors:
SunTrust Bank (term loan): $97,159.73
SunTrust Bank (line of credit): $29,256.58
Secam Inc (landlord): $11,188.92
Virginia Food Service Group: $10,028.27
City of Richmond Department of Public Utilities: $8,787.28
Island Refrigeration: $7,472.80
Dominion Va. Power: $6,235.69