Town Square

Post a New Topic

Lots of blame over restaurant's closure

Original post made on Jul 27, 2017

The owners of Morocco's restaurant are alleging they were forced out after their landlord essentially doubled their monthly rent. But the property owners dispute that claim, saying they they are the ones hurt by the downtown restaurant's abrupt closure this spring.

Read the full story here Web Link posted Thursday, July 27, 2017, 1:42 PM

Comments (30)

Posted by Alex M
a resident of Willowgate
on Jul 27, 2017 at 3:05 pm

Alex M is a registered user.

All I can say is, I will miss that restaurant, the food, and the belly dancing show that my little boy loved to participate in.


Posted by City girl
a resident of Another Mountain View Neighborhood
on Jul 27, 2017 at 3:12 pm

Was it some popular place, akin to Milk Pail, or was it yet another mediocre restaurant that no one will miss?
The only place that closed on castro that I truly miss already is Shezan. Best Indian food ever.
Anyway, all this just looks like another brawl and brouhaha, not much more. I hope the former owner is happy in Morocco!


Posted by Greedy Landlord
a resident of another community
on Jul 27, 2017 at 3:29 pm

If having his increased property taxes paid by his tenant costs the tenant more than the
lease, the owner should realize it's not going to worth it to the tenant.

So he could have had $4000 per month, but now he has NOTHING.

Greedy landlord.

He could also have bought it under an LLC and kept it from being reassessed.

Clumsy investor.


Posted by Common sense
a resident of Old Mountain View
on Jul 27, 2017 at 3:30 pm

City girl, FYI: Morocco's was MUCH better established than Shezan. It had been in business longer, it was a big favorite of people who lived in the neighborhood (that came out very vocally at last year's City-Council hearing, and Council members even praised Morocco's for being a good neighbor and a model small business), and it had opened up popular street life in the southern part of downtown Castro St., being the first restaurant on that part of the street ever to exercise the "flex-zone" option converting some street parking to outdoor tables.

Whether or not every Voice reader was acquainted with this restaurant, it was among the most popular in downtown MV, and has many fans still asking whether the Essadki family will reopen it elsewhere.


Posted by Resident
a resident of Cuesta Park
on Jul 27, 2017 at 3:47 pm

I can appreciate that people liked it and I do not like the ongoing sterilization of downtown MV. I will be one of the people crying when Tied House closes its doors -- I've probably been there 150-200 times and will miss it.

That said, did people really go to Morocco's? I walked by it 1-2x/week for years and rarely saw more than 3 tables occupied.


Posted by MVFlyer
a resident of Monta Loma
on Jul 27, 2017 at 3:50 pm

CityGirl: I don't know how popular Morocco's was, but it was VERY good. The food was excellent and the staff friendly and knowledgeable. I personally will miss it.

Also makes you wonder whose story was correct--the owner or the landlord or somewhere in between. But, I certainly wouldn't put it past the landlord to double the rent--it happens here a lot unfortunately.


Posted by Greg David
a resident of Old Mountain View
on Jul 27, 2017 at 5:41 pm

Greg David is a registered user.

This is an unfortunate situation for all, but the reality is the building was sold, which caused the tax reassessment, which increased his rent. This would have been in the lease when he signed with the original owner. The fact that they requested $1.4M to buyout the lease just shows me that they were looking for an easy payoff. Even as a small business owner, it is hard to feel sorry for them. Additionally, that location has seen numerous restaurants open and fail. It's just not the best location for that type of business. As for GPR, they also purchased the building I live in back in 2015 and they have been nothing but fair to me and the other tenants. They communicate what they can about the project timeline and I plan to stay in my apartment of 29 years as long as practical, but when the wrecking ball comes, I will move on. If you want to point fingers here, don't forget about the seller that was not content with five figures of rent income coming in every month...


Posted by Greg David
a resident of Old Mountain View
on Jul 27, 2017 at 5:43 pm

Greg David is a registered user.

@MVFlyer

The only "story" that really matters is the story told by the verbiage in the lease they signed. That is what it will come down to if this goes to court.


Posted by Just stop the feeding frenzy
a resident of North Whisman
on Jul 27, 2017 at 6:10 pm

The city really just needs to stop all development other than home remodeling or addons. The city is in for serious problems because of the feeding frenzy by developers and the overdevelopment will have unforeseen repercussions for geysers to come. This is just restaurant of many restaurants, one business of hundreds of small family owned businesses that will disappear, to be long forgotten and replaced by banks, corporations and huge mixed offic and housing buildings. This is the trend now, sadly. THE ONLY WAY TO STOP IT IS FOR THE CITY TO WAKE UP AND IMPLEMENT A BUILDING MORATORIUM.


Posted by Greg David
a resident of Old Mountain View
on Jul 27, 2017 at 6:47 pm

Greg David is a registered user.

For what its worth, this project will add a net increase of 14 housing units that will be all OWNED, not rented. The commercial space is aimed at restaurant/retail. The only businesses affected are the restaurant that is now gone and a doctor/dentist office. The six commercial units coming down are a hodge podge of three old buildings, the oldest from pre-WWII. The parking is inadequate and the spaces dated and inefficient. My family had a business in these buildings for nearly 50 years. They won't be missed. The apartments where I live, although I really like them, are also 60+ years old and would need major renovation to viable in the long term. I too am concerned about the speed of development in Mountain View, but if you look at this project closely, its a good one. What I don't want to see is another office building or massive corporate apartment complex...


Posted by He said she said
a resident of another community
on Jul 27, 2017 at 6:58 pm

The thing is both sides are telling the same story. The landlord admits promising to breech the lease at some unspecified time in the future, removing the incentive for the owner to make necessary maintenance and developement efforts for his business. So it's not true that the tenant just breached the lease. He was obviously reacting to the declaration by the owner to force him out, and this is reinforced by the city approval to the project which leaves no room for the same space to continue. The landlord will be demolishing the building for construction now that he has the OK. The restaurant cut its losses by leaving now, but the landlord started the process.

As for claiming the tenant is liable for RETROACTIVE supplemental tax assessments based on the sale, this is not so obvious. If he paid his rent each month and inquired what the change if any would be, then he was owed an answer. The county retroactively charges the property owner for an increased value upon change in ownership, but it's not clear the tenant is liable for that after the fact charge, since he has already paid the correct amount for the period in question. It would I think need to be specifically called out in the lease. It obviously wasn't addressed. The purchase by the new owner rendered the existing property uneconomic for the tenant under the terms of the lease through no fault of his own, but due to the actions of the property owner.

I'd say the property owner got off easy. He's lucky this guy is from Morocco and returned there without taking him to court. He needed the increased rent to justify the construction loan on his new project. It will make things tougher not to have any tenant at all. It calls to question the idea of including retail in the project. There's a glut of retain space at the current high rents. Retail is getting turned into office space left and right.

Bad landlord got what he deserved.


Posted by Greg David
a resident of Old Mountain View
on Jul 27, 2017 at 7:13 pm

Greg David is a registered user.

That's a lot of assumptions for someone with no evidence, having never read the lease, and knowing nothing about the finances of the developer.

Just sayin'


Posted by Dave
a resident of Old Mountain View
on Jul 27, 2017 at 7:27 pm

Speaking as both a tenant and a landlord of a subtenant, that's not the way it works. My contract is fairly standard and very clear -- we pay our agreed rent but the CAM can only be calculated once per year when the property taxes are known. My building was sold in 2016 and we had a huge CAM hit nine months later due to the increased value based on the sale price; property taxes doubled. It sucks, but we're also benefiting from a long term lease which is keeping the base rent well below market, so it's not all bad news.

Sounds like the Morrocans were not making enough to cover the increased property taxes. Unfortunate. But that building is old, ugly and needs to go.


Posted by Hmmmm
a resident of Cuesta Park
on Jul 27, 2017 at 7:29 pm

[Post removed due to being off-topic]


Posted by Retroactive charges
a resident of another community
on Jul 27, 2017 at 7:49 pm

Notice that the landlord admits they billed retroactively for increased taxes. Not cool. Not likely legal. Don't need to read the lease. No one would sign a lease that okayed that! No meeting of the minds. No contract. They left when they found out the rent would double, and they didn't need any notice because the landlord had already promised to kick them out before the lease ended.


Posted by Greg David
a resident of Old Mountain View
on Jul 27, 2017 at 9:01 pm

Greg David is a registered user.

[Post removed due to disrespectful comment or offensive language]


Posted by @Greg Davis
a resident of Cuesta Park
on Jul 27, 2017 at 10:03 pm

[Post removed due to disrespectful comment or offensive language]


Posted by Jes' Sayin'
a resident of Another Mountain View Neighborhood
on Jul 27, 2017 at 10:36 pm

I tend to believe the restaurateur most. The landlord had virtually the power in this situation.


Posted by Common sense
a resident of Old Mountain View
on Jul 28, 2017 at 9:38 am

Common sense is a registered user.

Morocco's wasn't simply one of "numerous restaurants" opening and failing. Savory (the elegant Vietnamese place that preceded it as tenant at 873 Castro) struggled constantly but rather passively with being located well apart from Castro's main restaurant cluster in the 100-400 blocks (where most of the pedestrians are). When the Essadki brothers opened their MV Morocco's there in 2011 (they had a restaurant already in SJ which they later closed to focus on MV), unlike preceding restaurants, they undertook proactively and impressively to make the name known and attract customers. They used approaches like nightly live entertainment (with community calendar listings in news media like the Voice), social-media outreach, a "wine club," a Farmers'-Market booth selling condiments, and sending employees not otherwise busy to walk up and down Castro carrying a big MOROCCO'S sign. A few years ago, they made history as the first restaurant there to pay the permit fee to convert their flex-zone from parking to street tables. When the front of the house wasn't busy, they were catering business customers. Morocco's thrived for six years, and I think would continue doing so but for this money dispute with their new landlords.

A point that's a bit hidden in the article (and that some commenters don't seem to realize) is that there wasn't "a" restaurant owner -- both brothers were fully hands-on. Jay, the younger brother, was the experienced restaurant chef, focused in recent years on his juice-bar spin-off nearby. Sham, the older, was a business guy and the main manager at Morocco's in those same years. Both have considerable roots and connections in the US and were educated here, and would periodically visit family in Morocco. I don't know their future plans, but being once again in Morocco at the moment doesn't preclude restarting a restaurant later at another Bay-Area site.


Posted by ResidentSince1982
a resident of another community
on Jul 28, 2017 at 10:22 pm

ResidentSince1982 is a registered user.

Seeing all the concern about this story, I looked at the website for GPR Ventures. Apparently they are a management company helping individual investors with their property, rather than the straight-out owner of the real estate. They have a lot of properties on their roster. So there is at the least a limited partner with a special interest in this new development taking over the Morocco's building.

On GPR's web site, a lot is said. The most applicable statement is this
"DECREASE RISK/INCREASE RETURN
Relative to the assumed risk of a particular asset class in the market place, employing effective management strategies, increasing occupancy and cost-effective capital improvements will yield a higher, disproportionate rate of return."

So, I guess the issue is, this disproportionate rate of return screwed Morocco's interests very well.... or so it would seem.


Posted by Laura H
a resident of Whisman Station
on Jul 29, 2017 at 10:11 am

Laura H is a registered user.

So this is the city we've become. No longer a community, but a profit-making machine for investors. City council please note: this is not what we voted for when we elected you.

@ResidentSince1982, thank you for the great investigative work.


Posted by ResidentSince1982
a resident of another community
on Jul 29, 2017 at 1:47 pm

ResidentSince1982 is a registered user.

More investigation. The assessed value on the parcel for the restaurant went
from $500K to $1.5 M after the 2015 sale. So it would seem the annual property
tax would go up $11,000 or so. How could that make a $4K per month increase
in the NNN monthly lease payment, or even be the major cause of that increase? Something else was going on besides property tax. It's hard to see the tax amount going retroactive, but for a $4K per month amount to go retroactive, there are all sorts of
questions. The landlord "discovered" the tenant was $40K behind in the rent after months. Hmmm. Odd. Off way to word it even. Well, can't investigate that, but it does go to the sleaziness associated with the current runaway real estate pricing, beyond the obvious increase in costs.


Posted by MyOpinion
a resident of Sylvan Park
on Jul 29, 2017 at 2:03 pm

MyOpinion is a registered user.

Morrocco's was not a mediocre restaruant (as suggested by city girl), it was a unique neighborhood spot with good food. Every restaurant does not require a Michelin Star to be enjoyable, in fact pricey restaurants are usually pretentious and the exorbitant prices, are a barrier to becoming a 'regular'.

I remember seeing Morrocco's owners at CSA (Community Services Agency) fund raisers, serving donated appetizers to attendees. They gave back to the Community, if all the businesses in Mountain View did the same it would be much nicer place to live. I am sad to see them go and wish them the best in their future endeavors.


Posted by Jim Neal
a resident of Old Mountain View
on Aug 1, 2017 at 10:37 am

Jim Neal is a registered user.

How many times does the city expect the residents to believe it when they say "This wasn't what we expected to happen"? After the first dozen times or so, I would think that it would be pretty clear what the result will be when you allow a project to come in that will affect existing successful businesses.

If the projects were to replace abandoned buildings or buildings with failing businesses, that would be one thing; but the city, in my opinion, appears to have an agenda to replace restaurants and small businesses, with more office space THAT WE DON"T NEED!

Case in point, here are the successful businesses (that I know of off the top of my head) that have so far been eliminated or displaced on or near Castro street :

Book Buyers
Peete's Coffee
Rose Market
Le's Alterations
Gochi's Japanese Fusion
Meyer Appliance
A Minute Man Show Repair
Sufi Coffee Shop

This list does not even include other businesses currently threatened by a new office project such as The Tied House and Chez TJ; or those currently threatened by the double whammy of the new Hotel project and the closing of Castro street at the tracks: Hong Kong Bistro, Fu Lam Mum, and Ephesus.

I know that many are going to say "The hotel project hasn't even been defined yet, how can you say that those businesses are threatened"? Pretty much the same way that I predicted what would happen to the businesses that "used to be" in the 800 block of Castro street and what happened to Morocco's, and what almost happened to the Milk Pail.

The Milk Pail is only still here because thousands and thousands of people took a stand, but the city knows that people can't do that for every single small business and so we end up saying goodbye to many of our favorite places not because they failed, not because of a bad business model or bad service; but because they city allowed them to be redeveloped out of existence.

The next time you vote, ask the candidates if they support small businesses or big offices, and then check their voting record. If you want wall-to wall offices and less restaurants and small businesses on Castro, vote for the big office candidates; if not then vote for the small business friendly candidates (if there are any). It's up to you.



Jim Neal
Old Mountain View


Posted by MyOpinion
a resident of Sylvan Park
on Aug 1, 2017 at 11:52 am

MyOpinion is a registered user.

I do agree with much of what Jim says, although I don't know if Sufi Coffee and Book Buyers were making a profit? I loved both businesses and was sad to seem them go but if any of us owned those buildings and had an offer of millions to sell we would probabaly do so. I don't think long time owners of single family homes are refusing their cash windfalls so a young family can buy their property for 350K.

With that said, although the city does not have much control over what private owners they do have the ability to designate buildings as historical (Chez TJ, Tied House), and they do have the ability to zone areas to be used only for restaurants/retail along the ground level Castro corridor. As far as I can tell there are far more ground level offices along Castro (example, Quora corner Castro/Church). But as we have seen all over downtown, developers get what they want...yet I cannot replace a 50 year old 12x6 foot shed because it's a few feet too close to our fence.


Posted by ResidentSince1982
a resident of another community
on Aug 1, 2017 at 1:44 pm

ResidentSince1982 is a registered user.

Hey, Peet's Coffee is not gone. The developer there delayed start of construction to allow time to construct a nearby temporary building to house it during the project. Then it will come back to a new spot in the finished building. That's not the same thing as dishonoring a lease. It cost the developer of that project quite a bit to honor the lease of Rose Market and Peet's Coffee. They also I believe made payments to Le's Alterations, Sufi Coffee, and the beauty shop to relocate during construction. Overall, this was a cost of the project.

Contrast that to the developer of this project which allegedly has restaurant space on the ground floor when done. Forcing the restaurant out saved them a lot of expense. It's a mystery why they say "why should we want the restaurant to leave?" Just wait, they'll be leasing the space for offices saying there is no restaurant interested.


Posted by Sherlock
a resident of Whisman Station
on Aug 1, 2017 at 8:45 pm

Sherlock is a registered user.

Simply put, the city needs more revenue. The city of Moraga recently declared a fiscal emergency. The historic rains caused a damaged bridge and a sinkhole that led to the rapid depletion of city funds. Wonder how long before Mother Nature throws her next curveball, and Mountain View is left in a similar situation.

Web Link


Posted by MyOpinion
a resident of Sylvan Park
on Aug 1, 2017 at 9:11 pm

MyOpinion is a registered user.

Town of Moraga has population of approx 17k, City of Mountain view approx 75K, Mountain View has many businesses located within City limits, don't get the comparison of Moraga to MV.


Posted by ResidentSince1982
a resident of another community
on Aug 1, 2017 at 10:46 pm

ResidentSince1982 is a registered user.

Yeah, really, the Moraga analogy is worse than weak. Moraga is a bedroom community with fewer jobs than residents. It loses 3000 population in the daytime while the head off to work elsewhere and no one takes their place in the city. Mountain View has been ADDING 42,000 to its daytime population due to all the jobs filled by outside residents. Now with all the Google cramming it's probably already more like adding 50,000 to its daytime population, even with a small increase in residents. With Google's and LinkedIn's plans, even when adding 5000 additional new residential units, Mountain View's daytime population is likely going to grow by 60,000 each day. These are jobs, but the tax revenue comes from property taxes since Google pays no sales taxes to the city, not even on the restaurant meals it prepares and serves to workers Breakfast, Lunch and Dinner.

No, Mountain View is not short of revenue, not one bit.


Posted by Richard Kent
a resident of Castro City
on Aug 6, 2017 at 2:25 pm

I have lived just off Castro Street for years and enjoyed the Morocco's restaurant regularly. Like the owners of this restaurant I have had to deal with Glen Yonekura on several occasions. [Portion removed due to disrespectful comment or offensive language]


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


Post a comment

Sorry, but further commenting on this topic has been closed.

Stay informed.

Get the day's top headlines from Mountain View Online sent to your inbox in the Express newsletter.

Is California engaging in wishful thinking or rigorous planning?
By Sherry Listgarten | 12 comments | 5,862 views

New Austrian cuisine: Naschmarkt to replace Anatolian Kitchen in Palo Alto
By The Peninsula Foodist | 3 comments | 3,546 views

Please prioritize saving Palo Alto's emptying downtown
By Diana Diamond | 13 comments | 1,703 views

Holiday Hoopla in the City
By Laura Stec | 0 comments | 1,057 views

“Attached.” by Amir Levine, MD, and Rachel S.F. Heller, MA
By Chandrama Anderson | 1 comment | 1,014 views