DC Restaurateur Xavier Cervera Back as Owner of Eight Capitol Hill Restaurants
by Larry Janezich
Xavier Cervera and his partners are back in business as owners of the string of eight restaurants located on Capitol Hill and near the Nationals Park that were sold to a Boston equity firm in December of 2012, (update) as first reported by Hill Rag, here: http://bit.ly/2cO1YDU
When profits began to sag under the new ownership, Xavier Cervera was brought back as a consultant to right the listing ship. Fifteen months later, in March of 2014, when the buyers defaulted on a payment, they filed bankruptcy, which prevented ownership from passing back to the Cervera group under terms of the sale.
A year later, in March of 2015, Katy Stech reported in the Wall Street Journal that the bankruptcy case filed by the Boston group had been settled out of court, but was unable to report on the details of the settlement or “who won.” That report stated the original components of the sale were $4.5 million up front and another $9.7 million over time, with the provision that if the buyers missed a payment the sellers could take back the restaurants. Stech reported that out of court negotiations lead to a restructuring of the debt and the court subsequently dismissed the bankruptcy case at the owners’ request.
Today, it’s clear that the ultimate winner was the Cervera group, which has ended up with ownership of the restaurants. On August 30, 2016, Cervera and his partners received notice from Barracks Row Holdings that they were unable to meet their financial obligations and they intended to turn control of the restaurants back to the Cervera group, effective immediately.
(Actual transfer of ownership back to the original owners requires approval of lenders, landlords, and the D.C. Government, but Cervera and his partners don’t anticipate any major delays or issues with that process.)
Capitol Hill Corner asked Cervera to comment and received the following statement from Capitol Hill Attorney James Loots, who represents Cervera and his partners:
“The latest default and surrender of the restaurants came as a surprise to Xavier and his partners, who have been working with Barracks Row Holdings over the years to avoid exactly this situation. However, now that it’s happened I know that Xavier is excited and looking forward to bringing the standard of quality for these restaurants to a higher level than ever.”
“We are continuing to work with Barracks Row Holdings and its attorney in order to assure a smooth transition and change in ownership.”
Loots is also the Advisory Neighborhood Commission representative whose single member district includes the businesses on the west side of Barracks Row.
Upon receiving notice from Barracks Row Holdings that they intended to give up the restaurants, Cervera, who now lives in a small town in Maine where he is pursuing other development interests, returned to DC, driving all night, to make sure the restaurants didn’t close the next day and to start rebuilding the businesses. That effort will include improvements such as new menus, renovations, and the return of former staff members as well as bringing new employees on board. One of his first steps will be to temporarily close Lola’s Barracks Bar and Grill and begin a major refurbishment of the interior.
The eight restaurants include The Hawk & Dove, Lola’s Barracks Bar & Grill, Molly Malone’s, Pacifico Cantina, Senart’s Oyster House, the Chesapeake Room, and the two outlets near the National Stadium, Park Tavern and Willie’s Brew and Que. (A ninth restaurant – Boxcar – was sold back as part of the bankruptcy restructuring and has been operated independently since early 2015.)
For the March, 2015, WSJ article, see here: http://on.wsj.com/2bYuOeo