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The Canteen, which features the Square Bar and outposts of Mediterranean food stall Yalla, Fred’s Meat & Bread burger and sandwich stall, and TGM Soup Co., is permanently closed on Fifth Street in Midtown.
The food hall, owned by the Canteen, LLC, made up of Jennifer and Ben Johnson, Shelley Sweet, and chef Todd Ginsberg, is part of Rye Restaurants group that includes restaurants like Wood’s Chapel BBQ and The General Muir.
The closure of the three-year-old food hall is due to an unrecoverable loss in revenue and lack of rent relief stemming from the ongoing COVID-19 pandemic, according to Jennifer Johnson. The Canteen temporarily closed in March as the city and statewide COVID-19 shutdowns began.
Eater Atlanta received two tips late last week claiming furniture and equipment had been removed from the property. When finally reached for comment, Jennifer Johnson confirmed the closure to Eater in an email, describing the Canteen as a “break-even operation” that relied on foot traffic generated by Georgia Tech and the surrounding businesses within Tech Square. The campus and most of the offices in the area continue to remain closed. The Fred’s kiosk located at Mercedes Benz Stadium was run out of the kitchen at the Canteen. The stadium is closed through at least the end of the month per Georgia Gov. Brian Kemp’s statewide order.
Documents provided to Eater by Johnson seem to show attempts by the partners starting in late March to work out an agreement with the landlord on some form of rent relief for the Midtown food hall during its closure. The landlord began pursuing legal action last week of nearly $20,000 in back rent owed for April and May on the Canteen. According to Johnson, the dispute has since been settled, and they have agreed to turn over the property to the landlord by the end of May.
While the Canteen partners say they understand emergency rent forbearance wasn’t part of the terms of their current lease, not receiving it during the extraordinary circumstances resulting from the pandemic made reopening the food hall “impossible.”
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“We have agreed with The Canteen’s landlord to vacate the space rather than proceed to litigation over rent we cannot pay right now. The Canteen will be closing for good,” Johnson says in an email.
The partners reportedly applied for an Economic Injury Disaster Loan under the U.S. Small Business Administration for the Canteen. The emergency loan provides small businesses within “declared disaster areas” like Georgia with money to continue operating and to help pay necessary expenses while recovering. Those funds have yet to be received. However, they did not apply for emergency funding under the Payroll Protection Program (PPP) due to the complicated nature and stipulations regarding that loan’s forgiveness terms.
The PPP is part of the federal government’s CARES Act, which allows small businesses to pay employee wages while closed due to the COVID-19 crisis. To receive full loan forgiveness, a business must use 75 percent of the funding by the end of June to rehire employees back at pre-pandemic levels. The other 25 percent can be used for non-payroll expenses such as rent and utilities.
“There is certainly a lot that is good about the PPP, but not if your business [the Canteen] is not operational at all and your employees are well cared for by unemployment benefits. Then it is just unnecessary debt,” Johnson tells Eater. “We absorbed several Canteen employees into our other restaurants. As we continue to ramp up at our other locations, we will call on any Canteen employees who may want to come work with us at another restaurant.”
Under the governor’s latest executive order, restaurants are permitted to reopen for dine-in service but must comply with a set of state-mandated health and safety guidelines. Among the 39 COVID-19 requirements for Georgia restaurants to follow, the most notable require all staff to wear face masks and limits dining capacity to ten patrons per 300 square feet. The guidelines remain in place through May 31, unless otherwise extended by Gov. Kemp.
A devastating loss of revenue over the last few months, lack of real rent relief from landlords, and inability to secure substantial emergency funding have left many restaurant owners like the Johnsons, Ginsberg, and Sweet with little choice but to close their businesses permanently amid the pandemic. C&S Seafood and Oyster Bar in Roswell, Cacao Cafe, Blaxican, the Sandy Springs location of Cafe Sunflower, and Panahar Bangladeshi Cuisine have all closed this month as a result of the COVID-19 crisis.
The Canteen opened in 2017 in the space previously occupied by the Spence, owned by celebrity chef Richard Blais. The food hall overlooks the plaza at the Centergy One building in Midtown.
A second location of Emory Point Jewish deli and restaurant The General Muir could open later this year in Sandy Springs. The partners’ other restaurants, brunch spot West Egg Cafe, the General Muir, Wood’s Chapel BBQ, TGM Bread, and Fred’s and Yalla at Krog Street Market, are all currently open for takeout.
Stay home if sick. Check the Georgia Department of Public Health website for guidance and updates on the latest number of reported COVID-19 cases. Numbers are now updated three times a day.