SalemNews.com, Salem, MA

October 15, 2013

Scanlon proposes eatery deal

Agreement would allow Black Cow restaurant to be built on waterfront

BY PAUL LEIGHTON
STAFF WRITER

---- — BEVERLY — Mayor Bill Scanlon is asking the City Council to approve a deal that would finally put a restaurant on the Beverly waterfront.

The agreement, which Scanlon sent to the council last week, calls for a 40-year lease between the city and restaurant owner Joseph Leone, who would build a Black Cow restaurant similar to the ones he runs in Hamilton and Newburyport.

Leone would knock down the former McDonald’s restaurant that has sat mostly vacant since it closed 20 years ago and spend $3 million to build a new restaurant.

Leone first proposed the plan six years ago, but it has been hung up by legal appeals filed by neighboring Beverly Port Marina.

The latest appeal, filed in the state Appeals Court in August of 2012, is still pending. Scanlon said he is seeking council approval now so that the restaurant can be built as soon as the court case is settled. The City Council’s legal affairs committee is scheduled to discuss the lease tonight at City Hall.

“The objective here is to have a lease ready to go, assuming the Appeals Court renders a favorable opinion, which we expect,” Scanlon said. “There were complicated negotiations to develop this lease, and we wanted to give the council adequate time to consider it.”

The contract calls for Leone to pay the city $30,000 per year, with adjustments for inflation, to lease the city-owned land where the restaurant would be constructed.

Scanlon said the restaurant would generate revenue beyond the lease when you factor in property taxes, meals taxes, parking meter revenue and boat slip rentals. The lease includes a stipulation that the first floor of the restaurant must be used for a “water-dependent use.”

“By the time we’re through, I think we’ll be bringing in a six-figure amount of money every year that will grow,” Scanlon said.

But the attorney representing the adjacent Beverly Port Marina questioned why the city would approve a lease agreement before the pending legal appeal is settled.

“We’re kind of scratching our heads why the city is doing this now,” attorney Adam Brodsky said. “It seems to us premature for the city to consider a lease for a project which they may not be able to develop. A lot of time and money will be wasted by something that might not come to fruition.”

Brodsky said the case was argued before the Appeals Court on Sept. 12, and it could take months before a decision is rendered.

Brodsky also questioned the financial terms of the lease and whether they benefit the city.

Brodsky said Beverly Marina owners Frank and Suzanne Kinzie are not opposed to developing the waterfront, but they disagree with the city’s approach to the Black Cow plan.

“We’d be willing to partner in redevelopment of the Beverly waterfront,” Brodsky said. “We just think this project is not appropriate.”

The proposed lease agreement between the city and Leone calls for a 200-seat restaurant with an outdoor deck. There would be 63 metered parking spaces open to the general public, not just to restaurant customers.

The lease requires that the first floor of the building be leased out for some type of “water-dependent use” in order to comply with the area’s distinction as one of the state’s 12 designated port areas. Leone said he might bring in a business similar to the children’s boat camp that runs at his Newburyport restaurant.

Also as part of the lease, Leone would be responsible for maintaining the adjacent public Ferry Way Landing.

Leone said the cost to build the restaurant has gone up considerably since it was first proposed six years ago, but he is still excited to get going.

“It’s been a long time coming,” he said. “I’ve worked very hard, and I’ve stayed committed to this project.”

Staff writer Paul Leighton can be reached at 978-338-2675 or pleighton@salemnews.com.