city state

City-State Brewing Co. Has a Can-Do Attitude: Husband-wife team is all about celebrating life in the District

This article first published on Eater Washington DC on April 21, 2017

If they’re going to pour their life savings into opening a brewery anyway, City-State Brewing Co. co-founders James Warner and Kim Carnahan figure they might as well build something to grow into.

 “To go as big as you can from the start can set you up for success in the future,” is how Warner explained his desire to start with a 30-barrel system — by comparison, DC Brau Brewing Company has built up its presence with a 15-barrel system; a new 30-barrel brewhouse is in the works — outright. The aspiring entrepreneurs are looking for a 10,000-square-foot facility (Ivy City, Edgewood, and Anacostia are all on their short list) able to accommodate a production brewery, taproom and beer garden.

In addition to being a supportive spouse — “James is so ecstatic when he’s making beer,” she told Eater — Carnahan, who works for the State Department, said the pair crunched the numbers and remain confident there’s still money to be made in craft brewing.

A former congressional aide (Warner said he and Carnahan met while working on climate change issues and energy policy), Warner has been home brewing for years. He’s also spent time within the industry, having worked as a server at ChurchKey, and currently handling sales for a major beer distributor.

 He noted that some of the products bookmarked for the City-State launch are literal labors of love. “Some of these recipes started life getting ready for our wedding in 2013,” he said. (Their theme was “celebrating D.C.”)

Core City-State beers

  • Holy Go-Go: Abbey Dubbel brewed with grains of paradise from West Africa and sugar from Latin America as an homage to the city’s musical history
  • Eight Wards Independent Pale Ale: expected to feature an ingredient representative of each part of the District
  • The Brookland: saison
  • Equal Marriage: dark wheat beer
  • Self-Determinator: German-style lager

“Each beer will tell the story of D.C. in a different way,” Warner said of his portfolio of beverages.

Warner and Carnahan are working with Nick Freshman, a hospitality vet who last fall launched strategic consulting firm Mothersauce Partners, to find investors for the ambitious project. The goal, Warner said, is to have the taps flowing at City-State by summer (or fall) of 2018.

“We think there’s plenty of room in D.C. still,” Warner said of the local beer scene.

Spring Brings New Deals

I have been dying to write this blog post as all the details were being settled and all the documents signed. There is a long blog post in me about my love-hate relationship with lawyers. One of whom is my partner. Another time.

Nonetheless, as I write this the sun is bright and warm, and the air smells sweet from new blossoms and feels soft on my skin. Spring is here, and it is the time to leap forward with excitement and hope. As the last nails are hammered in for Takoma Beverage Company, they are only a moment from bursting into life. It has been an incredible—and incredibly fast—journey with founders Seth and Chris, and I am thrilled to see the opening just ahead. I hope you will come visit the store sometime to see for yourself what makes it such a great concept.

And more is coming to life in this season of naissance. We have partnered with two incredible concepts, and we are fundraising for both. Take a look below, and feel free to reach out to me if you are interested in hearing more.


 

City-State Brewing Company
The Flavor of the District

Founders James Warner and Kim Carnahan are committed to paying homage to their adopted hometown of Washington, DC, but they know that it will take more than a name to make a mark on the DC beer scene. James quit a promising career in politics to go all in on his hobby. He has worked in every capacity in the business, and all the while with the intent to learn as much as possible about the beer business so that City-State can be as successful as possible. I was sold on the beer at first taste, and it didn’t take much longer for me to be sold on the team. With a solid business plan in place and a significant amount of money already raised, James and Kim are far along in the process. Mothersauce will join with them to get City-State across the finish line and open for business.

The Eleanor
Bowling Lounge, Music, Bar & Grill

Adam Stein is a well-respected Chef and industry veteran who has launched multiple successful concepts over the years, and now he is ready to launch his own. The Eleanor will help to define Ivy City as the District’s next great neighborhood. The 7,000 square foot location will feature four bowling lanes, event/music space, a movie screen, bar and lounge area and an outdoor patio geared for large scale food and drink events like pig roasts and crab boils. Think of it as a cooler, bolder Spider Kelly’s. The Eleanor has the size, the style and the skill to make a huge impact that will go far beyond its neighborhood. With an LOI in hand for the location, the founders are ready to get going.


I hope that you enjoy this season and the hope and excitement it brings. It is great time for our company, and if you are interested in being a part of all that we are doing, feel free to reach out to me anytime at nick@mothersaucepartners.com.

 

The Eleanor, Bowling Lounge, Bar & Grille, Coming to Ivy City!!

This article first appeared on PoPville on April 20, 2017

 

Holy mackerel – my dream is becoming a reality!! For those still doubting the hotness of Ivy City – behold The Eleanor from Adam Stein and Nick Freshman:

“The Eleanor will be a Bar and Restaurant from several of the city’s industry veterans. Located at 1900 Kendall Street, Washington, D.C. in the Ivy City Neighborhood, the space is just under 7000 square feet to accommodate four bowling lanes, event/music space, movie screen, bar, arcade, large outdoor patio, and kitchen. From bar stools, to high-top seating, couches/lounge areas for seating at the lanes, and outdoor patio, we are expecting an occupancy of around 300 people.

The Eleanor is an idea fifteen years in the making. It originated in Yellow Springs, Ohio while Chef/ Owner Adam Stein attended school at Antioch College where a ten-lane bowling alley was for sale. Stein knew opening a venue with bowling lanes was something he wanted to do. Long story short, the lanes were sold and parted out to make room for a parking lot.

The Eleanor will offer a wide range of cocktails with many house-made components, mid-Atlantic draft beer, and an exciting bar menu featuring regional products in an approachable way. High open ceilings, concrete walls and floors will set the stage for a funky industrial space that will house four bowling lanes, movie screen, music venue, and nostalgic arcade games. Casual bistro meets art deco bowling alley is the aim.

The kitchen will focus on Adam Stein’s track record of sourcing sustainably from the region and in season. Daily food specials will be available to showcase the scratch kitchen and available products throughout the year. Fresh takes with attention to detail will be the hallmark.
The large outdoor space allows for special food events such as crab boils, pig and lamb roasts, and smokers for BBQ.

The heart of The Eleanor will be a multi-use space with stage and large movie screen. Along with offering regular nostalgic and holiday themed movies throughout the year, the screen can be used for first-run independent films from artists in the region, video game competitions, slide shows and presentations for events, coordinating visuals for music performances, and not to mention sporting events.”

I guess this is what I needed to finally download one of those fandagled car sharing apps the kids are always talking about. Buckle up and stay tuned for many updates as they get closer to opening!

Restaurant Forecast for 2017: Sunny and Warm, but Mind the Thunderstorms

If you have lived in Washington for some time you know that the weather for summer is pretty much the same: hot, often sunny, Amazon-like humidity and a chance for a violent thunderstorm every day at about 4:00PM.

Once you get over questioning why you live here and not in San Diego, you adapt and realize that it is pretty nice here—just find a pool and you’ll be fine.

Same goes for 2017 for Mothersauce and the restaurant business in DC (first up for us: Takoma Beverage Company). I think the weather will be great, but we need to watch out for the storms.

There has been a lot of talk about a local restaurant bubble as well as a national one, and the talk is not going away. To be sure, there are serious issues in our business that are creating problems for many businesses, and it may get more challenging before it gets better.

But I wouldn’t start throwing around the “B” word. I think that kind if hyperbole is great for headlines, but I think it can distract businesses from focusing on what the real issues are. I think that the underlying issues are going to lead to more of a correction than a crash, and there are several areas and specific businesses that will continue to grow strongly this year and beyond.

What are the issues?

Well, there are a lot, and they can be very geographically unique. There are a million reasons why a restaurant or several restaurants in an area can fail, but added up together they are not necessarily indicative of a massive trend.

Still, there are some issues that are universal, serious and not going away: the continuing labor shortage, high rents and segment saturation.

Labor. It is always hard to find good people, but the complaints I hear from operators across the country about staffing have never been this severe. It is an employee’s market out there which is great for the talent, but it strains businesses as they try desperately to fill their schedules. The glut of openings means that there are lots of open positions and not enough people to fill them. Service suffers consequently, and there are operators stalling their own growth to avoid this.

Part of the solution starts with better training and incentives. We need to let people know that this business can be a good career option at any level with tremendous opportunity for growth, and then we need to make sure these people are well trained and ready to succeed.

High Rents. The landlord perspective would be valuable here, but until I buy a building, I can’t offer it. What I can say definitively is that rents in the most popular area for restaurants have been very high for a long time. It is no revelation to state that the rents climb as an area gets hot, and then they decline much slower on the other side.

Rent can be a killer for a restaurant. Already tight margins only get tighter with high rent, and if there is no help from the landlord, if a potentially great long term restaurant suffers a minor setback or needs some time to grow its business, the runway might end before they make it.

But isn’t it in the landlord’s interest to have a sustainable, long term tenant? You would think so, but many landlords require a portion of the lease guaranteed, so the tenant can be stuck with the rent long after they close—and that sure is fun.

To me, the ideal scenario is to see the tenant-landlord relationship as a partnership where both can be successful. Restaurants often put a lot of money into spaces that improve their value, they can make a building and even a neighborhood more popular and valuable, and if they are doing well they can stick around paying rent for a long time. These are all things that help the landlord. Lower rents and more managed leases are the way to go. I’ll hold my breath…

Saturation. A word that we started throwing around in Clarendon 10 years ago. Yes, 10. It may have taken longer to get over and past that breaking point, but it was pretty clear it was coming. At a certain point, a market can only sustain so many places—there just aren’t enough customers to go around. The customer base gets spread thin, a couple stand outs do well, a lot of places teeter on the edge of profit, and a lot of places have to close. Then it starts to look like a wasteland of empty spaces.

Zoning requirements for ground floor retail in new developments have been awesome at creating vibrancy in neighborhoods, but at a certain point if every single new building has retail options, there is too much space. The rents don’t drop as you think they might, but tenants stream in anyway, and…boom.

There are at least a couple former restaurants spots in Clarendon that are rumored to switch use, and I think that is great. I know this contradicts the rent theory in a way in that less space available will create higher rents for restaurants, but what I think works best is to find that sweet spot—other retail uses can pay rent as well and fill empty storefronts, and the best concepts can fill the best space and be successful.

There are a lot of smart people out there thinking about this, and a lot of us are reading and listening and talking about these issues as we forecast this year and beyond.

I will continue to research and solicit input, but I think that we are not in a bubble in the sense that we are awaiting a big crash like real estate in 2008. I think a correction is already happening, be it in my neighborhood or nationwide, but I believe that we will keep growing, and that there is tremendous opportunity in our business. For that reason, I believe 2017 will be a great one for Mothersauce. We just need to keep our eye out for those storms.

Clarendon Metro

Carnage in Clarendon: Restaurant Trends in Arlington’s Hottest Neighborhood

“Define the definition.”

What the Hell is that supposed to mean? Beats me, but I said it. What can I say, it was my first podcast. I was recently a guest at the ARLnow.com offices for their series, “26 Square Miles-An Arlington Podcast.” Given my background and given the popularity of restaurant articles on the site, I was pretty sure that I was going to be asked about the recent spate of closings in Clarendon. It is a topic worth exploring for sure, and I did my best to contribute to the conversation.

If you are up for it, take a listen here. We jump right in, and then pull back to broader industry trends outside of just our neighborhood. At the end, we talk about the inspiration for Mothersauce, and the plans I have for the company.

So just what has been going on in Clarendon? Well…

Tagliatelle, Brixx (6 months), Park Lane (8 months), Ri Ra, Boulevard Woodgrill, Fuego, Spice, Hard Times, American Tap Room , Amsterdam Falafel.

That’s 10 this year, and I have probably left someone out. Rumors swirl about more closures on the way, and many in the neighborhood are seeing their numbers fall.

So what is behind the Carnage in Clarendon? Hyperbole aside, a lot.

Clarendon has come a long way since the days of my youth when we would head there for Vietnamese food and not much else. The Metro’s arrival, and the brilliant planning by County leaders about how to develop around Metro laid the foundation for the success many businesses have been able to enjoy subsequent. That was 40 years ago. The past 10 years the growth has exceeded even the most optimistic forecaster’s dreams, and Clarendon has become the destination nationally for development. It hit all the right metrics and the residents and businesses flocked.

But there is a limit.

Many of us who have been in the neighborhood for some time felt that the saturation point was inevitable, and we feel we hit it a couple years before half of the businesses above even opened. As operators raced to benefit from the exploding customer base in Clarendon, rents skyrocketed to levels that were just ridiculous. Businesses signed on to high rents right as the market became flooded with concepts.

At the same time, external trends worked to shrink the famous customer base. DC exploded. 14th St., Shaw, Navy Yard, Barracks Row, NoMa. Neighborhoods few would venture to five years ago have become sought after hot spots only a short, cheap Uber away. We have certainly felt that at Spider Kelly’s.

Stuck with high rent and fighting with similar concepts for a shrinking customer base doesn’t leave a business with a lot of runway to make it. This is only heightened if the concept offers nothing particularly distinct.

And so here we are.

As the culling continues, what remains to be seen is what comes next? Many of the concepts that close will be replaced by new concepts (Ri Ra, Boulevard Woodgrill, Hard Times). Others are rumored to be switching to retail. Still others remain dark with no signs of what is to come.

Clarendon is still a great place to live, work and do business, and there is still tremendous opportunity for success. What made it so attractive many years ago continues to be what will make it attractive in the future—proximity to the city, access to mass transit, great schools and parks, and of course a vibrant commercial corridor with great businesses.
The difference is that those of us still here need to work harder, be smarter and continue to try to grow our businesses to offer our customers what they want. Why do you think we built a Beer Garden?

I am a native Arlingtonian, and I still live in the County. My daughter goes to Arlington Public Schools and many years ago when the planning was being done to grow Arlington’s commercial centers and preserve our unique neighborhoods, it was my Mom, Judy Freshman, who helped with the plan. I am invested heavily in the County, and in Clarendon, and I am very optimistic about its future.

In the meantime, at Spider Kelly’s, we will continue to focus on getting better at what we do, and watch to see who is still around when the dust settles. Hopefully, we will be.

Full Podcast: http://arlnow.libsyn.com/ep-12-spider-kellys-co-owner-nick-freshman