SAN JUAN CAPISTRANO : Plan for New Restaurant at Train Depot Is Sidetracked

A plan to open a new restaurant at the old train depot downtown has apparently fallen through because its proposed operators couldn’t secure enough money from investors.

A city-imposed deadline to close the deal was Tuesday, City Manager George Scarborough said.

Last month, the City Council voted to transfer the lease to a group of San Juan Capistrano businessmen who were scheduled to take over the historic city-owned landmark.

Joe Campbell, one of the general partners with the investment group, said Wednesday that he could not obtain the money needed to proceed.

“I wish it would have gone forward,” Campbell said. “It’s unfortunate because it’s an incredible opportunity.”

Scarborough said the council must now decide what to do. At least one council member has said he favors selling the depot that the city bought for $1.1 million in 1986.

But the city would have to work out an arrangement with the current leaseholder who closed down his restaurant, Rio Grande Bar & Grill, last month and owes the city $25,000 in past-due rent.

Mayor Carolyn Nash said the city could try to find a new group of investors to open a restaurant, find a new leaseholder or look at selling the depot.

“We were trying to keep a business in there,” Nash said.

Under terms of the lease transfer, the city was to forgive the leaseholder, Trackside Dining Inc., of its late rent.

The new investment group would have also been reimbursed up to $100,000 for any building improvements.

Some downtown restaurant owners criticized that part of the agreement, saying it was a subsidy other eateries could not get.

Also, under the lease transfer, the new investment group would have paid 6% of its gross receipts to the city, with a guarantee of at least $3,500 a month. The overhead would have been offset by $1,800 in monthly rent paid by Amtrak to the leaseholder.

City officials had said they expected to receive about $8,000 a month from the new restaurant.