Granite City to grow with $6.5M investment
This week, the controlling shareholder of Minneapolis-based brewpub chain Granite City Food & Brewery, Concept Development Partners LLC, or CDP, invested an additional $6.5 million in the brand to help accelerate its post-recession unit growth, the company said.
CDP has been an active owner since May 2011, when a preferred-stock transaction made it Granite City’s largest shareholder and also ushered in CDP’s Rob Doran as its chief executive. Doran, a former McDonald’s USA executive, along with Granite City founder and president Steve Wagenheim, have embarked upon a program to remodel Granite City’s 27 locations and pare down the menu to the best sellers.
The company also acquired the Cadillac Ranch dining-and-entertainment concept last November for $9 million, which gave Granite City a second growth vehicle for high-traffic, tourist-heavy areas where the brand typically does not go. The company now operates six Cadillac Ranches in five states. The two concepts will share back-office efficiencies and best practices for food and service to grow together over the next few years, Doran and Wagenheim said.
Granite City opened a new prototype in Troy, Mich., this year and will begin construction on three more locations to start in 2013, with a plan to accelerate new-unit development beyond that. Doran and Wagenheim spoke to Nation’s Restaurant News about how they want to grow Granite City prudently after shoring up operations and the menu during the recession.
With this new investment of $6.5 million into Granite City, is the plan to kick off a new initiative or to accelerate your current plans to remodel Granite City locations?
Wagenheim: What this allows us to do is lengthen our search and look for properties for 2013 and 2014. That’s important for us so we can have seamless year-over-year development. This allows us to follow a solid three-to-five-year plan and prime our development pipeline.
Doran: Over the last year, we’ve remodeled five existing restaurants and opened one. We’re about to break ground in Franklin, Tenn., downtown Indianapolis, and one other location. We had money to grow at two to three units a year, but there were so many great opportunities out there that we wanted to accelerate that growth. All our remodels were already budgeted.
Now that the Cadillac Ranch acquisition is complete, how do these two casual-dining brands complement one another?
Wagenheim: From a real estate site perspective, they’re very complementary. Granite City is more community-based, and we’ll go into suburban markets with a strong combination of daytime population and residential. Cadillac Ranch is a very powerful destination concept that’s placed in tourist developments.
I think the Granite City concept could use a little more fun that Cadillac Ranch knows how to produce, and the Cadillac Ranch people could be helped with Granite City’s support on food and a little polish.