PITTSBURG -- Continuing its appetite for high-end downtown restaurants, the city will spend $1.3 million in redevelopment money to outfit a proposed Asian fusion eatery and slice the rent for the space housing an Italian cafe nearly in half.
The Asian fusion venture will be in the commercial space on the ground floor of the Vidrio housing and retail complex on Railroad Avenue, joining a community bookstore that opened in the fall.
The operator, Blue Delta, will pay 4 percent of gross sales to lease the 3,360-square-foot space, or an estimated $48,000 a year, plus a monthly maintenance fee of $885.
In return, the city's Redevelopment Agency will put up $1 million to build out the restaurant space, and the agency's economic development fund will spend $300,000 for restaurant equipment.
Blue Delta also operates Sasa restaurant in Walnut Creek and Blue Ginko in Lafayette, according to Councilwoman Nancy Parent.
The city also is reducing the monthly rent for the white-table-cloth La Veranda restaurant, at 444 Railroad Ave., from $8,454 mandated under a revised lease agreement in 2008 to $5,833 per month, with a 5 percent annual increase.
La Veranda's operators are slated to begin paying rent June 1 after rent payments were deferred for three years.
The Redevelopment Agency owns La Veranda's furnishings and equipment but leases the space from the building's owner.
In a report to the City Council, city staff cited the higher operating costs of a high-end restaurant, such as linen, dinnerware, flatware and glassware, along with other factors, for the rent reduction.
The lower rent reflects what the city could command for the space from another operator if La Veranda were to close, according to the report.
Both items were approved unanimously at Monday's council meeting.
"The Asian fusion restaurant will give us a new option, give the public a new choice downtown," Parent said. "The La Veranda modification is because of the economic downturn."
The two moves follow a couple of other subsidized food ventures in Pittsburg's Old Town that have yet to bear fruit.
The Redevelopment Agency has invested $6.5 million in the E.J. Phair Brewing Co. that will be opening this week, according to partner Becky Wynn, after more than five years of construction.
Pittsburg's power company also paid nearly $1 million to the agency to take over the 615 Restaurant, a joint venture with the culinary academy of Los Medanos College, in February.
The space, at 615 Railroad Ave., across from Vidrio, will soon house a Pittsburg branch of Lumpy's Diner, an Antioch restaurant that serves hamburgers, salads and other All-American fare.
Lumpy's owner Jeremy Sturgill has agreed to pay $3,469 a month for the space, with the power company providing $10,000 in tenant improvements.
Contact Rick Radin at 925-779-7166.