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New York's Tavern on the Green files bankruptcy
2009-09-10
NEW YORK (Reuters) - Tavern on the Green LLC, operator of the storied restaurant in New York's Central Park, has filed for bankruptcy a few months before the venue is set to change hands. It is expected to keep operating as usual through December, then is expected to undergo substantial renovations. Central Park restaurant owner Dean Poll won the license for the location in August and is set to take control in December, subject to city reviews and approvals. Poll has proposed a $25 million renovation project. Restaurateur Warner LeRoy had operated Tavern on the Green from the early 1970s until his death in 2001, when his family took over. LeRoy had also owned another famous New York restaurant, the Russian Tea Room. Tavern on the Green has long been known as a romantic location for marriage proposals, and tourists flocked to see its mirrored rooms. In a statement obtained by Reuters, Chief Executive Officer Jennifer Oz LeRoy said the Chapter 11 bankruptcy filing was the result of the financial distress brought on by the U.S. recession and City of New York's decision not to renew the lease. "Our whole way of looking at food and going out has evolved," said Clark Wolf, president of food and restaurant adviser Clark Wolf Consulting. "We are less inclined to visit the old warhorse, just for the sake of nostalgia. We've gone from wanting a kitschy comfort food to wanting truly comforting foods and the latter is better and harder to do." Chapter 11 filings allow a company to shed some debts while it reorganizes. "Cleaning the slate and keeping what they already have," said Wolf. "That's the benefit (to a bankruptcy filing)" Poll also operates the popular Boathouse restaurant in Central Park. The New York City Department of Parks and Recreation awarded the Tavern on the Green license to Poll, saying he had submitted the best proposal on the basis of "solid financial backing" and a substantial capital investment. HISTORY The restaurant, which opened its doors in 1934, filed for Chapter 11 bankruptcy on Wednesday. The same day, New York's trendy Cafe des Artistes, known for attracting customers from theater and dance professions, filed a Chapter 7 filing. A Chapter 11 filing allows a company to reorganize and shed debts, while maintaining control of the business. In a Chapter 7 filing, the company is usually liquidated, with assets overseen and sold by a trustee. Tavern on the Green can seat as many as 1,500 people in six dining rooms. It is housed in a building that was originally designed as a sheepfold. "To thousands of visitors, Tavern on the Green is New York," wrote the New York Times in a 2005 restaurant review. The restaurant was run by various managements till Warner LeRoy -- the creator of the popular Maxwell's Plum -- acquired its lease after it was shut down by Restaurant Associates. LeRoy reopened the restaurant in 1976 after spending about $10 million to renovate it and add original paintings, antique prints and etched mirrors to convert it into a popular spot in Manhattan. The bankruptcy petition listed assets and debt in the range of $10 million to $50 million. The largest unsecured creditors include the New York Hotel Trades Council, with a claim of $1.78 million, and CCS Architecture Inc., with a claim of $235,000. The case is In re: Tavern On The Green Limited Partnership, U.S. Bankruptcy Court, Southern District of New York (Manhattan) Bankruptcy Petition, No 09-15450. (Reporting by Chelsea Emery; additional reporting and writing by Santosh Nadgir and Dhanya Skariachan in Bangalore; editing by John Wallace, Dave Zimmerman)
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