Cava Staff Put on Protective Notice :( Could be closed in 2 weeks!

Cerulean Chicken

McTigs wrote: »

oh that's bad form!

Surely they would know exactly how much is out there in unclaimed vouchers. Is it really worth the potential loss of goodwill to honour them?

Seems to be a bit of a grey area, two different vouchers, some will be honoured, others won't. Grrr.

Col200sx

I have a voucher for Cava, and I'm 99% sure on the outside of the envelope it also has Aniar and Eat business names and logos on it.

It doesn't specifically say the voucher is for Cava.

So I'm guessing the voucher is eligible for all

Cerulean Chicken

Col200sx wrote: »

I have a voucher for Cava, and I'm 99% sure on the outside of the envelope it also has Aniar and Eat business names and logos on it.

It doesn't specifically say the voucher is for Cava.

So I'm guessing the voucher is eligible for all

Apparently - I emphasise apparently, I would check with them - if the voucher is orange it's valid in all 3, if it's white it's only valid in Cava and has to be used by next week. That is what I was just told by a friend who is trying to figure out what to do with a voucher she bought for someone else. Pity that that isn't clear though, and unfair.

Col200sx

Cerulean Chicken wrote: »

Apparently - I emphasise apparently, I would check with them - if the voucher is orange it's valid in all 3, if it's white it's only valid in Cava and has to be used by next week. That is what I was just told by a friend who is trying to figure out what to do with a voucher she bought for someone else. Pity that that isn't clear though, an unfair.

Ya the voucher is orange alright

But even if Cava re-open a couple of weeks later as Cava in another premises, won't they all be eligible again?

Surely they wouldn't shoot themselves in the foot and not honour Cava vouchers in the new Cava?

Seaneh

There *probably* wont be a new cava.

Cerulean Chicken

Col200sx wrote: »

Ya the voucher is orange alright

But even if Cava re-open a couple of weeks later as Cava in another premises, won't they all be eligible again?

Surely they wouldn't shoot themselves in the foot and not honour Cava vouchers in the new Cava?

Seaneh wrote: »

There *probably* wont be a new cava.

You don't know for definite that there will be a new Cava, we can only live in hope!

Why do you say that Seaneh, do you know something??

Col200sx

Seaneh wrote: »

There *probably* wont be a new cava.

That'll be a real pity if so

Love Cava, the pork belly is amazing there

dloob

It seems the city tribune tomorrow will have a report on how none of the group of restaurants are making money.

https://twitter.com/endacunningham/status/292008833960800256

Cava, Aniar and Eat restaurants were all loss-making, 2011/12 accounts show. See tomorrow's Galway City Tribune.

yer man!

If they are nearly always full, how are they not making money......

Playboy

yer man! wrote: »

If they are nearly always full, how are they not making money......

I think he means not making a profit... Probably due to excessive overheads like rent and wages

GastroBoy

They must have been paying a huge amount of rent, they couldn't have been making much of a profit, or even balancing. Some other places in the
Dominic St. vicinity are E120,000 a year!!

http://galwayindependent.com/stories/item/5567/2013-3/Popular-restaurant-says-meeting-rent-was-a-‘struggle’

yer man!

Playboy wrote: »

I think he means not making a profit... Probably due to excessive overheads like rent and wages

Well ya obviously, I just don't really get how a landlord or an overbearing bank could expect more rent from a tenant that's making near the most it can possibly make, but there's a lot that we don't know about this so.....

JohnCleary

What I find fascinating is that while the excuse for closing down is about rent, they won't give a figure.

Don't get me wrong, i'm sure the rent is indeed a sky high price (people here say they opened 7 years ago, when rent would have been very high)

Unrealistic

yer man! wrote: »

Well ya obviously, I just don't really get how a landlord or an overbearing bank could expect more rent from a tenant that's making near the most it can possibly make, but there's a lot that we don't know about this so.....

I have absolutely no idea if this applies to the current situation so I'm just putting it out there as an example of why a bank might take that approach. Say for example someone borrowed €2.4m from the bank and put up a building as collateral. The bank gives out the €2.4m and has an asset in the form of a loan on its balance sheet. A few years pass Ireland's banking system experiences one of the worst crashes ever and suddenly maintaining the value of each asset on the balances sheet is a life or death matter for the bank. Let's say it's an interest only loan and the property is receiving €120k rent per year which is covering the interest. Then the lease comes up for renewal and the tenant says "I can only pay €60k going forward". The landlord goes to the bank and the banks says "no f##king way". Because as long rent of €120k is coming in the bank can pretend that the loan on its balance sheet is still worth €2.4m (5% yield) but if the rent drops then it has drop the pretence, revalue the loan to reflect the underlying value of the security and take a hit in the form of a provision on its balance sheet and net profit. But even if the building is empty the fact that it was recently leasing for €120k and is on the market for €120k buys the bank some time before they have to record a provision against the loan and take a loss. The landlord is screwed either way. If he signs the lower lease the rent won't cover the interest and he either has to top it up himself or wait for the bank to foreclose and take the building off him. If he lets the building sit empty then he might get an interest holiday but the amount he owes is constantly increasing and he'll probably still lose the building but at a later date. He and the bank are both trying to keep things afloat hoping against hope that the economic situation will improve and rents and building values will rise before they both go under.

Again, there's no indication that this is the case with Cava so I'm just posting it as an explanation of why someone speculated earlier in the thread that it doesn't necessarily have to be the landlord but that a bank could be driving the decision.

?Cee?view

Unrealistic wrote: »

I have absolutely no idea if this applies to the current situation so I'm just putting it out there as an example of why a bank might take that approach. Say for example someone borrowed €2.4m from the bank and put up a building as collateral. The bank gives out the €2.4m and has an asset in the form of a loan on its balance sheet. A few years pass Ireland's banking system experiences one of the worst crashes ever and suddenly maintaining the value of each asset on the balances sheet is a life or death matter for the bank. Let's say it's an interest only loan and the property is receiving €120k rent per year which is covering the interest. Then the lease comes up for renewal and the tenant says "I can only pay €60k going forward". The landlord goes to the bank and the banks says "no f##king way". Because as long rent of €120k is coming in the bank can pretend that the loan on its balance sheet is still worth €2.4m (5% yield) but if the rent drops then it has drop the pretence, revalue the loan to reflect the underlying value of the security and take a hit in the form of a provision on its balance sheet and net profit. But even if the building is empty the fact that it was recently leasing for €120k and is on the market for €120k buys the bank some time before they have to record a provision against the loan and take a loss. The landlord is screwed either way. If he signs the lower lease the rent won't cover the interest and he either has to top it up himself or wait for the bank to foreclose and take the building off him. If he lets the building sit empty then he might get an interest holiday but the amount he owes is constantly increasing and he'll probably still lose the building but at a later date. He and the bank are both trying to keep things afloat hoping against hope that the economic situation will improve and rents and building values will rise before they both go under.

Again, there's no indication that this is the case with Cava so I'm just posting it as an explanation of why someone speculated earlier in the thread that it doesn't necessarily have to be the landlord but that a bank could be driving the decision.

You're dead right.

One thing worth adding.

Many commercial mortgages contain a clause that if the loan to value falls below a certain %, the bank can repossess. So if the rent falls or is reduced, the value automatically falls and the owner is at risk of losing the property. This can be the case even if the repayments continue to be made.

beardybrewer

churchview wrote: »

You're dead right.

One thing worth adding.

Many commercial mortgages contain a clause that if the loan to value falls below a certain %, the bank can repossess. So if the rent falls or is reduced, the value automatically falls and the owner is at risk of losing the property. This can be the case even if the repayments continue to be made.

Well... that's it so...

Mrs OBumble

churchview wrote: »

Many commercial mortgages contain a clause that if the loan to value falls below a certain %, the bank can repossess. So if the rent falls or is reduced, the value automatically falls and the owner is at risk of losing the property. This can be the case even if the repayments continue to be made.

But according to people earlier in the thread, all a commercial landlord has to do his put his / her feet up, and watch the cash come rolling in. Sure they won't be sweating about mortages and the like :rolleyes:


NB I know absolutely nothing about the particular building, who owns it, or what borrowing they might have.

El_Dangeroso

I find it hard to believe that a unit on Dominic St. has a higher rent (per table) than one on Quay St.

And I don't see the restaurants on Quay St. half as full as Cava is during the week.

Anyone care to speculate how a business could make a loss in this environment?

McTigs

Mrs OBumble wrote: »

But according to people earlier in the thread, all a commercial landlord has to do his put his / her feet up, and watch the cash come rolling in. Sure they won't be sweating about mortages and the like :rolleyes:

that is actually very often the case in old galway buildings most of which are family owned for generations

but go ahead and condescend and :rolleyes: all you want.

NB i don't know the details of this case either

dloob

yer man! wrote: »

Well ya obviously, I just don't really get how a landlord or an overbearing bank could expect more rent from a tenant that's making near the most it can possibly make, but there's a lot that we don't know about this so.....

I found the article in the Tribune, it's not on-line.
The gist was most of the loss was being blamed on initial setup costs for Anair and Eat in the 2011/2012 accounts.
More of an over dramatic headline from the tribune than anything.