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Out on the town
By: Hortense Leon, Florida Real Estate Journal
Last Updated: Tuesday, February 26, 2008

The restaurant and nightclub business has more than a fleeting
connection to the entertainment business. And no one knows this better
than Athan Tom Prakas,
president of The Prakas Group. The 52-year-old owner of the Boca
Raton-based commercial real estate brokerage company, which specializes
in restaurant and nightclub sales and leasing, represented Danny DeVito
as the exclusive broker for the actors chic South Beach restaurant,
DeVito South Beach, which opened in June 2007. Prakas also recently
brokered the sale of the glamorous La Vieille Maison, Boca Ratons most
famous French restaurant for more than 30 years.

A 25-year veteran of the restaurant and nightclub industry, Prakas has
owned and operated 27 restaurants, nightclubs and sports bars during
his career in Ohio, Atlanta, and South Florida. And this experience
guided him toward establishing the Prakas Group in 2000.

Prakas has arranged many transactions in South Florida over the last
eight years, with some outside of the region, but he is most well-known
for his work in Delray Beach. In fact, the Prakas Group has done 42
deals in that northern Palm Beach city and brokered 23 of 26 restaurant
leases on Atlantic Avenue in downtown Delray Beach in the last four
years. 

And last fall, Prakas teamed up with The Finance Group, a mortgage
broker that is now a division of the Prakas Group. It finances deals,
mostly in the restaurant and hospitality industry, between $3 million
and $10 million.

In 2006, Prakas opened an
office in Orlando, and The Prakas Group in January 2008 brokered a
lease for a 10,000sf space for Valentinos Vin Bar, a restaurant chain
that started in Las Vegas. The Orlando location is the former site of
Lees Lakeside restaurant on the south shore of Lake Eola in downtown
Orlando, which has been closed for a couple of years, said Prakas. The
restaurant is expected to open in another three to four months.

On Jan. 1, 2008, The Prakas
Group became a partner with the Florida Restaurant and Lodging
Association. It has taken over the organizations business opportunity
Web site, which is designed to help clients who want to sell their
small businesses, including restaurants, for less than $150,000. The
Web site is called RestaurantBizSales.com and is run by Prakas wife,
Donna. It was a service we saw a need for, said Prakas, because so
many small businesses today get their start on the Internet.

Although Prakas is not
planning any more expansions of his business for the foreseeable
future, he is optimistic about the restaurant and nightclub business in
Florida in the long run, even though he sees that in the near term,
growth is slowing down. He has had deals recently that were contingent
on the financing of restaurant properties and/or financing for larger
projects, of which the restaurant was a part, collapse. Not every deal
closes, especially in a tighter credit market, said Prakas.

In the commercial market,
said Prakas about non-restaurant deals, the slowdown is just starting
and will last through 2008. Maybe it will turn around in 2009, when
the credit markets get cleared out. Something has got to happen by
then, he said. The housing market should bottom out, and the
commercial market should follow shortly after that.

Meanwhile, the (income)
stream looks good on the sales and leasing side (of The Prakas Group),
although it is unpredictable, Prakas said. We are not a retail
business with bricks and mortar. Our sales are abstract. In January, we
could have $20 million (in deals) and nothing in February and March,
he said, while noting that he does have a couple of significant deals
scheduled to close in March or April.

Although retail rents vary
greatly, depending on the area, they dont seem to be going down at
this point, said Prakas. This is especially true on Las Olas Boulevard
in Fort Lauderdale and on Lincoln Road on South Beach, which are trendy
areas. As for other, less chic locations in South Florida, he said that
while in most places we dont see a softening yet, there is a lot of
room for variation. In secondary locations, such as in Wellington,
Coral Springs and Pembroke Pines, there may be a little weakening in
the future, said Prakas.

One thing helping to buoy up
revenues in restaurants and nightclubs, added Prakas, is the weak
dollar. Many patrons and restaurant buyers from England and Ireland,
where the euro is the official currency, are taking advantage of the
situation, he said. These buyers are looking all over, not just in the
trendy locations, Prakas noted.

Much of South Floridas
restaurant and hospitality business is doing well compared to other
places in Florida, he said. North of Sebring and in the area between
Tampa and Naples where homes are empty and dark, the restaurant
business has been adversely affected, he said. But in South Florida,
even in locations like A1A in Sunny Isles Beach, where there are a lot
of unoccupied luxury condominiums, there is still a large resident
population and customers for restaurants, although customer traffic
will pick up once the residential units are sold, said Prakas.

But in the PGA corridor in
Palm Beach County, where lots of chains have recently opened new
restaurants, it is hard to fill all the seats until the residential
units fill up, said Prakas. It is just the opposite on Lincoln Road.
Not only are there crowds of customers, retail rents have doubled over
the last five years, he said. They were in the $40s and $50s psf. But
today, they are closer to $100 psf, he said.

Originally posted 2008-03-11 00:00:00. Republished by Blog Post Promoter