Los Tres Amigos May Fill Former Dimitris Restaurant Space in Downtown Farmington

The Farmington Downtown Development Authority board approves an agreement to lease the property to the Michigan-based chain.

A Michigan-based Mexican restaurant chain may be opening its newest location in downtown Farmington by Cinco de Mayo 2013. 

The Farmington Downtown Development Authority (DDA) on Monday approved an agreement to lease the former Dimitris restaurant at Grand River and Warner to the owners of Los Tres Amigos, which has nine locations in Canton, East Lansing, Jackson, Howell, Lansing, Mason and Michigan Center. 

Executive Director Annette Knowles said four proposals came in after the DDA purchased the restaurant property in July. The Los Tres Amigos proposal came in on Aug. 14, and the DDA submitted a counterproposal. The DDA executive committee reviewed that response Monday morning. 

"I have an email that says, 'Let's get this lease going,'" Knowles said. 

DDA board members discussed the terms of the lease, which gives the restaurant 39 months in the first lease term, and 36 months for each term following. Knowles said the restaurant will pay $4,000 per month in the first term, with a 5 percent increase for every extension of the lease. 

The restaurant will pay utilities and taxes, and keep insurance on their business. 

"They do plan an extensive build-out," Knowles said, adding the plan is to create a patio with outdoor seating. 

The motion to approve the agreement included a stipulation that the DDA executive committee negotiate points with the restaurant owners:

  • Establishing a "floor" for the amount that the owners spend on building improvements, which were generally described in the agreement
  • Setting a different price for the $350,000 purchase option after the first two lease terms, so that the restaurant owners would pay either $350,000 or the amount established by an appraisal, whichever is greater

Board president Bob Rock said the DDA initially proposed resetting the purchase price every time the lease is extended, but the restaurant owners rejected that because they wanted more time to see whether the business is doing well. 

In addition, the restaurant owners are asked to submit three years of financial statements, pass a background check, agree that the city attorney will review the final lease agreement, which is expected to come forward for DDA approval in the next few months.

Knowles said the city will retain ownership of the parking lot behind the building, even if the restaurant owners exercise their option to purchase. Later in the meeting, she said some improvements will be made to the Dumpster area and parking lot. 

Eric Vogel October 23, 2012 at 03:04 AM
Sound great! I see the buy out is $50k less. Not sure if that is the rent charged over the lease or what. But it sounds like the city could be out some serious money?
Joni Hubred-Golden October 23, 2012 at 03:20 PM
Eric, the city will retain ownership of the property behind the building, so the purchase would only be for part of what the city bought. I believe the split is 75-25, and $350,000 is a little under the amount paid for that portion of the property. Also, the owners have said they will need time to see if the restaurant does well before they decide whether to buy the property, which means they'll be handing over at least a year's worth of $4,000 lease payments.
Steve October 24, 2012 at 02:47 PM
Don't get me wrong, I think its great to see business moving into downtown. Especially in the short amount of time since Dimitris was pushed out. But I was under the impression that the DDA/City was looking for a 'Destination' restaurant for this building? Something to bring people from all around. A Mexican chain restaurant is far from a 'destination' restaurant in my opinion. It sure isn't going to help the new Chul Bu'ul Mexican take-out restaurant jsut donn the street if that ever opens.


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