Is the Traders Cove Restaurant Deal Fair for Taxpayers?

A proposed bar and restaurant to be built at Traders Cove Marina in Brick, NJ. (Photo: Daniel Nee)

When a new restaurant opens up next year in Traders Cove Marina and Park, will its owners be paying enough in rent to Brick Township’s taxpayers?

A number of residents – who said they were both in favor and opposed to the restaurant plan – voiced concern that the $75,000 annual rent Chefs International would pay on the site was below market rate, especially since the company will not pay  additional property taxes to the town above the lease payment.

The lease between the township and the company calls for $75,000 per year, with a 2 percent escalator each year, for 24 years. Chefs International plans on building an outdoor, seasonal restaurant on the site, which will feature dock-and-dine opportunities, fire pits and sand lounges.

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“It doesn’t make any sense, and it’s very unfair to the taxpayer,” said resident George Scott, adding the fact that the restaurant will not have to purchase a liquor license should have been considered when determining rent.

Township Attorney Kevin Starkey said the restaurant will be able to obtain a license directly from the state since they are located on publicly-owned property.

“It breaks down to $6,250 per month,” said Richie Campbell, another resident who spoke. “This restaurant is going to easily surpass River Rock and be the most popular bar in Brick. “There are businesses on Mantoloking Road that are abandoned and are commanding more of a lease payment than that.”

The lease of the property includes a unique way of calculating the $75,000 fee. While technically the restaurant will have to pay property taxes, that amount will be credited to the rent, so no matter the property tax assessment, the restaurant will pay only the $75,000 each year, Starkey said.

Mayor John Ducey the rent was determined through a comparison with the 9th Avenue Pier restaurant in Belmar, which is also leased by Chefs International at a publicly owned marina. The annual lease there is $100,000.

“In Belmar, it’s a major road, Route 35, and there are a bunch of different successful restaurants in the area that people can walk to,” said Ducey. “Because it’s not on a major road, there’s no history of a successful restaurant being that far down on Mantoloking Road, and the fact that people can’t walk there … the agreement was down to $75,000.”

Because the restaurant will not have walls, it will only be able to operate seasonally, added Ducey.

“When you do the June, July, August, September four month period, you’re talking $17,500 a month,” he said.

The $75,000 figure falls in the middle of what other bars and restaurants are paying in property taxes in Brick.

River Rock paid $47,921 in property taxes last year, the former Pilot House/Riverwatch restaurant paid $84,865, Brick House Bar and Grill paid $37,539 and Used to Be’s paid $18,781. All of those establishments are typical buildings and operate year round.

Ducey said it should also be noted that Chefs International will spend $2 million constructing the facility at the marina.