Thursday, February 17, 2011

The home of Ración

A few weeks after fruitlessly seeking retail spaces on foot and on loopnet, some of our downtown dwelling friends told us to check out the up-and-coming area along the Broadway Corridor. Driving around, I found a promising retail space at the Blackstone Lofts and decided to take Teresa to scope it out that same night. As we were poking around, she noticed For Lease signs going up in the windows across the street. The spaces were part of the historic Eastern Columbia Building, gorgeous at 11 o'clock at night.

For some very lucky reason, the current tenants Mark and Lisa were just settling into the space with their gallery and had the doors open as they worked. We wandered in, and immediately found common ground on the beauty of the space and the emotionality of the artwork. Something in the explanation of our restaurant concept must have resonated with them because not only did they show us the adjacent retail space (which was smaller, and ultimately what we set our sights on), but they showed us the loft that they owned, and called the owner of the retail space the next morning on our behalf. Within a few days, we had met with the owner and brokers and had an LOI in the works!

When we embarked on our effort to find a space for our restaurant, I had no idea what to look for, what to negotiate, how to phrase my negotiations. With the help of MANY friends (lawyers, architects, designers, business owners and operators, local residents) we pieced together a few documents that made sense to us and the nature of our business. Though not without a few painful moments, the process of finding our restaurant spot is exactly what I envision for Ración: a combination of a little luck, a gut reaction that this just feels right, and the combined interest of a whole group of very cool people.

You should know our concept: The Executive Summary

The Opportunity
If you ask Angelenos where to get good Spanish food in the city, they will send you to the temple of molecular gastronomy in LA, The Bazaar, or trendy wine bars that include so-called “tapas” as an afterthought, or worse yet, shoddily-run smaller businesses with little ambiance and low-quality food. Ración will address the gap of high-quality, affordable, and casual Spanish-cuisine dining in Los Angeles. Specifically, it will provide sustainably-sourced, unique preparations of traditional Spanish cuisine in a design-forward, modern setting with a European feel and casual, hospitable, and knowledgeable service.

The Concept
Ración seeks to combine the dining traditions and flavors of Spain with the consciousness of a modern Californian dining experience. Ración will introduce a new level of sustainability to the food services industry, one that extends beyond food sourcing and energy efficiency to include sustainability in preparing and serving food. Ración will be an inventory-driven restaurant that creates from what is available rather than allowing a pre-set menu to dictate what it orders, prepares, and inevitably wastes. In addition, Ración will creatively use every part of whole animals to avoid the wastefulness of cooking with “prime” cuts, and reduce hierarchy in its service structure so that employees are empowered to be more productive. Ultimately, Ración hopes to introduce an ever-evolving concept of sustainability to restaurant operations, one that ultimately brings financial benefits to staff and customers.

The Market
Ración’s target market will be customers in Los Angeles who consider themselves “foodies” on two levels: 1) culinarily adventurous and 2) those who are interested in Ración’s sustainability element. Additionally, because Ración aims to realize financial savings through reduction of wastefulness, Ración’s target market includes individuals who are working and value-driven.

The selected location for Ración is in the Eastern Columbia retail space in the Broadway Theater District downtown, at 847 S. Broadway, Los Angeles 90014. The area is in walking distance to dense populations of local loft dwellers, commuting office workers, and the entertainment centers of LA Live and the Staples Center. The area has also received significant media attention as the focus of Councilman Jose Huizar’s economic development effort “Bringing Back Broadway.” As part of the revitalization effort, plans are in place to bring a streetcar connecting the Broadway corridor, the Financial District, and the Historic Core by 2014. RCH Studios, whose client list includes Shutters on the Beach and the W Hotels, has been selected as the architect for the project.

The Competition
Ración’s competition will exist in Downtown LA food-forward restaurants and Spanish-inspired restaurants throughout Los Angeles. There are currently no restaurants in LA that combine moderate prices, sustainable sourcing, and food-forward Spanish cuisine.

The Management
Teresa and Loretta have launched several projects jointly: the Border Grill Truck in LA, COLORS Restaurant in NYC, and COLORS Café, also in NYC. Together, they have determined the strategic directions of multiple concepts, created dynamic and successful teams, and received unprecedented, positive reviews for both food and service. Teresa and Loretta will act as chef and general manager, respectively, through Ración’s first phase of growth.

Loretta Peng: Loretta is an experienced restaurant operator who has launched three restaurants for Le Pain Quotidien in Los Angeles and a mobile catering operation for Border Grill, also in Los Angeles. Most recently, she rebranded COLORS, a struggling fine dining restaurant in New York City around themes of sustainability and launched a more casual outpost, COLORS Café at the NYU Wagner School of Public Service. Prior to her foray into management, Loretta held a Chef de Partie position at the two-Michelin starred Bouley in NYC. She graduated in May 2009 with an MBA from Columbia Business School and holds undergraduate degrees in Economics and American Literature from UCLA.

Teresa Montaño: Teresa is an experienced chef who has led several high-performing culinary teams to rave food reviews both in LA and NYC. She is driven by sustainability in farming and cooking, and has held positions at the Vital Zuman Organic Farm in Malibu and at Tender Greens, the casual organic restaurant. As Sous Chef for Food Network stars Susan Feniger and Mary Sue Milliken, Teresa led the start-up of the Border Grill Truck and earned an internship at the pioneering organic restaurant Nora in Washington DC. She then went on to serve as Executive Chef for COLORS in NYC and conceptualized a locally-sourced menu of global small plates, leading the kitchen to its best reviews since the restaurant launched. She attended the Art Institute of California, Los Angeles for Culinary Management.

The Financials
The amount of equity and debt capital required to launch Ración and cover operating expenses until the restaurant is profitable is $485,282 ($282,700 in start-up expenses, and $202,582 in operating expenses). Financial projections expect revenues to be $1,500,300 at the end of Year 2, with EBIT of $150,400.

Want More?
Check out our history, track record, philosophical musings, and launch process on our blog at

Contact Information
Loretta Peng

Teresa Montaño