Jack’s owner explains closure

By Dave Schwab and Kathy Day

Staff Writers

The owner of Jack’s La Jolla which shuttered abruptly last week said he closed his establishment because of the inability of some tenants in his building to pay their rent on time, the generally slowing economy and some “improprieties that went on.”

Bill Berkley would not comment further on the exact nature of the “improprieties,” stating more details are likely to come out in the next few weeks.

“Jack’s was profitable up until the end,” said Berkley, noting other contributing factors led him to shut his three restaurants down. “My more retail-oriented clients were struggling, except for Lawrence Poon Jewelers and Realty Experts. They have been excellent tenants, and they have always been on time in paying their rents.”

Berkley added he wouldn’t be surprised if the site of Jack’s reopened soon under new ownership and management.

Berkley said Jack’s was not in bankruptcy, but rather was in receivership. He acknowledged that the state has filed a tax lien for $280,000, which he said is related to the “improprieties.”

“I own the building and have 70 more years on a ground lease,” he said. “I’m talking to people to try to effect a sale, as soon as possible, of both the building and the business.”

He added that “the building has an existing loan on it that’s fully assumable and at a very attractive rate.”

The end at Jack’s, a high-profile casual and fine dining establishment came abruptly and without fanfare, according to one employee.

Kyle, a member of the kitchen staff who didn’t want his last name used, said Friday he was at work on July 30 when the “manager came in and said, ‘Clock out, Jack’s is closed.”

He said people were saying they had declared bankruptcy and that the doors were locked at 3:30 p.m.

“Managers were told to go ahead and take open bottles,” he said. “It was kind of a free for all.”

Managers were crying and saying, “Just leave, we’re done,” he added.

Kyle, an Ocean Beach resident who had started working at Jack’s about a month ago, said he had not received a paycheck. Some employees were told, “If you have a check, go to the bank and beg them to cash it,” he said.

The 17,000-square-foot, three-level restaurant complex had been transformed by Berkley into a multi-themed establishment including a five-star restaurant with a piano bar, a dance club and a tranquil bar with a 900-bottle wine list and live jazz.

Rick Wildman, current president of Promote La Jolla, the community’s business improvement district, said the lack of “draw” Jack’s provided will be keenly felt in the Village.

“It brought a lot of young people full of energy to La Jolla,” he said. “It sort of filled a niche.”

Deborah Marengo, owner of Goldfish Point Cafe on Coast Boulevard and former president of Promote La Jolla, noted Jack’s departure would have an adverse impact on local business.

“It’s a very sad day that so prominent a restaurant has closed,” she said. “You look at the effect of the Sak’s building being closed (in 2005) which had such a devastating effect on those streets (Wall and Herschel). Jack’s will have the same effect on surrounding businesses.”

Sinisa Ristic, owner of Let’s Go, a clothing boutique in the Jack’s building - which Berkley also owns - said he was saddened by the restaurant’s closing but didn’t think his lease would be impacted.

“It’s not going to affect us with our space,” he said. “Businesswise, we don’t know how this is going to affect us, though I’m sure it’s not good. It was a nice establishment. We would like to see more nice places around - it just looks like it’s going a different way these days.”

Phil Wise, a Village commercial Realtor, said Jack’s departure comes at a bad time, just when it looked like the Village’s depressed retail environment was beginning to turn around, with the $2.4 million sale of a building at 7844 Herschel Ave. and a new user on the horizon for the former Donna Marsh property at 7110-7112 Fay Ave.

Jack’s space is going to be tough to fill, Wise added. “The building Jack’s is in has always been a difficult building (to occupy),” he said. “He (Berkley) was very creative. Someone is going to have to come in and be just as creative to try and reposition that thing into something that’s very positive. But I think it can be done. It’s just going to take some ingenuity.”