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Success Came to Barney’s Beanery When Things Didn’t Change

When David Houston and his partner took over Barney’s Beanery, a West Hollywood landmark with 80 years of wear and tear, he assumed that the first order of business would be to clean things up.


“Luckily I came to my senses,” Houston said.


After the purchase four years ago, he started visiting the bar anonymously and talking and drinking with regulars, some of whom had patronized the establishment for decades. They told him in no uncertain terms: to polish the place up would be to kill it.


So Houston and partner Avi Fattal preserved the restaurant and bar as it was with the ramshackle d & #233;cor, pool tables and cozy clusters of dark booths with ripped upholstery. It has created a retro atmosphere for legions of actors, rock stars and assorted hangers-on.


The result? The place is doing better than ever, prompting Houston, Fattal and a handful of other limited partners to invest $1.5 million on a second restaurant on Santa Monica’s Third Street Promenade. At its current pace, sales at the new eatery will hit more than $4.5 million for its first 12 months, almost as much as the original.


Houston and Fattal plan to convert one of their three Q’s Billiard Clubs into a Barney’s in early 2006. And with sales at the original topping $5 million, the partners’ have ambitious plans to open a new Barney’s-type roadhouse every year, nationwide. “It would be cool for me to open, not really a chain, but a number of those very authentic, American rock n’ roll roadhouses,” Houston said.



Owning history


The Santa Monica Boulevard restaurant was named after its founder John “Barney” Anthony, a former Navy cook who started serving chili in 1920 on what was then Route 66.


Barney’s later became known as a celebrity hangout starting in the 1940s when Clark Gable and Errol Flynn were regulars, and later for the Doors’ Jim Morrison and rock singer Janis Joplin. Joplin carved her name in a table that now hangs from the ceiling and is rumored to have drunk screwdrivers at Barney’s the night she died of a heroin overdose in 1970.


“Barney’s is a destination place. It’s kind of like Pink’s Hot Dogs or the Pantry downtown,” said restaurant consultant Janet Lowder, president of L.A.-based Restaurant Management Services.


The restaurant also gained notoriety in the 1960s for a sign above the bar warning gays to stay out. The sign finally came down in 1984 on orders from the City of West Hollywood, one of the first actions of the city after incorporating that year.


Meanwhile, the roadhouse’s sales had been slumping for years largely because then-owner Irwin Held had been in declining health and couldn’t closely manage the place. While Houston and Fattal had not been in the market to buy a restaurant, Houston grew up in L.A. and was a fan of the Doors. So they became more than interested after receiving a solicitation from a business brokerage in 2001. They purchased the building, parking lot and small building next door now housing a sushi bar for $3 million.


The pair became friends in the 1980s when Houston was attending Cal State Northridge and Fattal, who came here from Israel in 1980, was running Autoshade, which makes folding screens for windshields. Fattal sold the company in 1989 and, in partnership with Houston, started Q’s.


They also have been partners on other investments, some more successful than others. (One misstep: a contraption inserted into the trunk of a car to keep grocery bags from tipping over.)


When the Barney’s deal came along, Houston and Fattal figured they would have to up the monthly take of $140,000 to $180,000 to break even. One of their first instincts was to trim down the 700-item menu to make it more manageable for cooks and servers, but they quickly ditched that idea.


Everything was kept, including the $175 Dom Perignon and chili-dog breakfast (available since the 1970s) and the 80 burgers, 20 hotdogs, 40 kinds of chili, and 200 brands of beer.


“It’s not like walking into Spago, where you expect to be blown out of your seat by the food because of the hype and reviews it gets,” Houston said. “But it turns out the food is really good.”


The new owners did add some modern touches, including 20 or so TV screens suspended from the ceilings. Houston’s sister, Lisa, the general manager, spent a year plastering the 40 tabletops with handcrafted collages depicting famous people and events in entertainment and politics.


The partners not only hit their $180,000 monthly sales goal, but have gone on to rake in up to $450,000 a month. “We like this place because it’s anti-L.A., it’s a real dive bar. You don’t have to dress up, you don’t have to be on a list like at dance clubs,” said Ashle-a Powell a 22-year-old saleswoman at Nordstrom and a regular Barney’s patron.


With the Santa Monica restaurant performing 15 percent above their projections, the Houston and Fattal plan on converting their Q’s on Colorado Boulevard in Pasadena into a third Barney’s in about six months.


For each location, Fattal and Houston raise a new round of private financing, selling ownership shares to a handful of minority partners. Each restaurant also has separate legal ownership so if one fails it doesn’t take the others down with it. “You never put all your eggs in one basket,” Fattal said.


After that, they will look at other locations. But opening a slew of new Barney’s brings with it the possibility of diluting some of what makes Barney’s attractive in the first place its egalitarian feel.


Houston acknowledges the risk but thinks that pitfall can be avoided. “I’m sure the very first T.G.I. Friday’s was really cool, but now that there are hundreds of them, it’s a canned brand,” he said. “That’s why we don’t want to have hundreds of Barney’s. We want maybe 30 and each one will look unique.”


Houston and Fattal are certainly trying. They plan to have a wildly painted double-decker bus as an interior seating area in the new Pasadena Barney’s.

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