Next Monday, Nathans will be no more. That much has been reported here and other places. But GM spoke with owner Carol Joynt today to get a little more background on how she arrived at this decision. To do the story any justice, we’ve got to go back to the beginning.
Nathans Restaurant came to be 40 years ago when a bookie calling himself Nathan Detroit got himself a lease from the Heon family for the space. (It had been a diner before that). Nathan roped in Charlie Matheson, a member of the Virginia horsey set, and Howard Joynt. As Carol told it, Howard was able to buy in with money he got from his dad. Essentially Nathans was a gift from father to son.
Soon after they opened, Nathan Detroit ran up a large gambling debt and wanted out. Howard’s dad gave Howard the money buy Nathan out. Soon after that Charlie’s wife wanted him out of the business as well. Howard’s dad gave Howard the money to buy out Charlie as well. That’s how Howard ended up the sole owner.
According to Carol, that was pretty much the story of the place. It never really afforded itself. Howard’s father was subsidizing it the entire time. She estimates that Howard got about $3 million dollars from his dad over time to help keep it afloat. That tap was dry by the time Carol took it over after Howard’s death in 1997 (not to mention the huge IRS bill she inherited). She had no interest in running the place and tried to get it off her hands, but circumstances prevented that from happening.
Lacking that additional source of money, Nathans was destined to eventually close. No investors were interested in buying into the restaurant since the rent was so high. Joynt tried to make due draining her son’s college fund and even selling artwork right off her walls. But that’s no way to run a business and that’s how we got to today.
As reported in June, Joynt signed a lease extension. But it didn’t really buy her much. As she put it in her blog:
So, we came to an agreement. I had to pay $100,000 to the city to bring the property taxes up to date, and another $30,000 in recent back rent that had been withheld. Plus another several thousand in outstanding BID taxes, and $11,000 in other taxes. That money was a loan on my house…If we default, which could happen in the doldrums of summer, the agreement is wiped out immediately, the hundreds of thousands of dollars of back debt reinstated, the court date reinstated, the eviction reinstated, and the threat on my house reinstated. That’s why I beg for your business, your dollars. We’ll see. We pray the June rent checks clear the bank. We also pray someone buys the building. In other words, miracles.
Her rent was $15,000 a month with an additional $4,500 monthly payment into an escrow account for taxes. Unfortunately, the miracle uptick in business didn’t happen and default became inevitable. But built into the lease extension was a grace period that enabled Joynt to get out of the deal without defaulting.
Seeing the writing on the wall, Joynt exercised that option.
Joynt called a staff meeting yesterday to break the news. She did it a week in advance in order to enable customers one last chance to come and enjoy a Georgetown landmark and for the staff to be the beneficiaries of a wave of nostalgic business. You have till Sunday night to take part in that. And be generous with your waitstaff. Remember that on Monday they’re jobless.
According to the Citypaper, the landlords are still looking for a buyer of the building. They had asked that all bids be in by June 15th. It would seem that they didn’t get what they wanted (they’ve said in the past that they want something in the $18-$20 million range).
It’s not clear at all what will eventually occupy that space. Rumors in the past have included T-Mobile and the Apple Store (that’s actually going in up the street). With the uncertainty of the sale of the building, it seems unlikely that anything will move in there soon. It would be great if another restaurant took over the space, but let’s be honest: only something utterly useless like a bank can afford that space. (GM is hoping a diversified entity like Capital Restaurant Concepts proves him wrong).
As for some grittier details: the upstairs tenants were sublettors, so they’re now evicted too. Most of the furniture, including the bar, is owned by the landlord, so it will stay for now. The great photography in the dining room always remained the property of the artist, David Kennerly, and so they will return to him.
As for Joynt, she’s moving on. Besides the $168,000 loan she took out on her house, she is finally free of the weight of owning an unwanted unprofitable pub. She’s currently writing a book on her experiences and will continue to write columns for the New York Social Diary. She’s even shutting down the Nathans website (which has hosted her blog) at the end of the month. She’s moving to a new address: CarolJoynt.com.
One famous element of Nathans will live on. After its normal summer hiatus, Q&A Cafe will continue in a new as-of-yet-undetermined venue. Possible candidates include the City Tavern and The Georgetown Club.
Reading up for this piece, GM glanced through the Washington Post archives for mentions of Nathans. He came across one article in particular that caught his eye from 1985. It told the story of one weekend night in Ronald Reagan’s Georgetown. Apparently parking along M and Wisconsin was severely restricted at the time and MPD was towing cars and giving out jaywalking tickets (they even set up a temporary police station in the Riggs Bank parking lot). ABRA and DCRA were also out giving citations for alcohol and health code violations, respectively. The effort was an attempt to dull Georgetown’s rowdy reputation.
What caught GM’s eye was how the article rattled off old names no longer around like Swenson’s, Annie’s, Friends of Georgetown and the Key Theater.
And now Nathans.