Untried Owner Aims to Beef Up Former Prandium Business
By ANDY FIXMER
Andrew Tavakoli is trying to pump new life into an old burger.
The real estate investor is making his first foray into the restaurant world with the $10 million buy of the troubled Hamburger Hamlet chain from Irvine-based Prandium Inc., promising a new management team and series of improvements.
Tavakoli wouldn’t put a price on the changes other than to say the cost of the upgrades was going to be “significant.”
“Over the next few months the customers are going to notice physical improvements within the stores,” he said. “As for food quality and service, within a few weeks customers are going to start noticing differences.”
His Tavaco Inc. bought the 13-store chain out of bankruptcy from Prandium, whose two other operating businesses, Koo Koo Roo Inc. and Chi-Chi’s Inc., also were operating under bankruptcy protection.
Koo Koo Roo was sold three months ago for $4 million to Beverly, Mass.-based burger chain Fuddruckers Inc.
Tavakoli blamed Hamburger Hamlet’s troubles on its old ownership.
“It has been a profitable company, but this is a Titanic, a very large ship, that has been cruising without a captain in place,” he said. “Although the operations guys have done a good job, they haven’t necessarily gotten support at the corporate level.” The chain had amassed $50 million in debt, according to a bankruptcy filing; the purchase did not include the assumption of any debt.
“The core of the company, the concept, has been healthy and the fact it’s been around 50 years is very telling,” he said.
Tavakoli said the immediate focus would be on improving food quality, service and ambiance. Restaurants also will have slight variations on their menus.
“Additional items that would cater to a specific subsection of the market will be added,” he said. “Hollywood has different demographics and clientele than Brentwood, so we will have slight changes from the core menu.”
Without any restaurant experience of his own, Tavakoli said he is in the process of hiring a team of experienced managers to help him run the operation.
“My initial response is ‘Wow, that’s a major challenge,'” said Selwyn Yoslowitz, president of the California Restaurant Association’s Westside-Beverly Hills Chapter and part owner of Marmalade Caf & #233;. “But if he brings in the right personnel, maybe he can do it.”
Fixmer is a staff reporter with the Los Angeles Business Journal.
