Doubts, dreams mix downtown

By Steve Kanigher

Saturday, Aug. 22, 1998 | 5:45 a.m.

Andre Rochat knows the restaurant business.

His elegant Andre's French Restaurant in a former home on South Sixth Street is one of the highest-rated dining establishments in the city.

Backed by 19 years of experience, he opened Frogeez On 4th, another downtown eatery that played to packed white-collar lunch crowds and weekend Latin jazz enthusiasts. By all accounts the food was superb and the atmosphere cozy, but a frustrated Rochat closed his doors July 31 after barely a year in business.

High overhead coupled with sparse dinner turnouts ultimately sounded Frogeez' death knell. But Rochat said things might have worked out differently had he received more cooperation from City Hall and the Fremont Street Experience. City officials argued, however, that they bent over backward to accommodate Rochat.

Either way, the closing of the restaurant sends mixed signals about the ability of small businesses to survive while the city attempts to redevelop downtown.

Frogeez was less than three blocks from bustling Fremont Street but attracted virtually none of the nighttime foot traffic associated with the casinos. Rochat figured to change that situation by advertising on one of the kiosks dotting the Fremont Street mall. He was told no space was available. Instead, he was invited to advertise in the Fremont Street Experience parking garage and have his band perform on the mall beneath a Frogeez banner throughout last December.

Rochat refused the offer. He reasoned that advertising on the mall would be much more effective than a garage notice. And the offer for the band to perform for "free" actually would have cost him $450 a night to pay for the musicians. He would have preferred a kiosk panel at $500 a month.

"There was a time when I believed in downtown, but not any more," Rochat said while directing Frogeez' interior dismantling. "It's not going anywhere. I can't advertise on Fremont Street, yet I pay $3,000 a year in property taxes to redevelop downtown."

Mark Paris, president and chief executive officer of the Fremont Street Experience, conceded that the hotels have first crack at the popular kiosks. But he quickly added that the hotels have borne the brunt of costs to create and maintain the pedestrian mall.

Hotels and tourists paid most of the $70 million price tag to construct the mall and its high-tech audio-visual canopy. But an estimated $11 million came from property-tax revenues levied on nongaming businesses and homes in the downtown redevelopment area. Rochat was one of those taxpayers.

"If there was a panel available, he was welcome to have it," Paris said. "At the time, they were all leased out. We couldn't kick anyone out to make room for him."

Rochat said he spent more than $700,000 in renovations to open Frogeez at a location where at least three previous restaurants had failed. But he said he could have spent much less and lowered his overhead had the city's department of building and safety done a better job of working with him.

"If you are going to redevelop an area, you have to make it business-friendly for small business, and it has to be something they can afford," Rochat said. "When there is building to do, the city should help these people and not kill them like they did to me.

"But people are afraid of the building department because they hold the key to your opening or closing, and it's a nightmare to work with them."

Department director Paul Wilkins countered that Rochat caused his own problems by failing to hire an architect before making the costly renovations.

"Most of the time you go back on an existing building and do a major remodel, it's more complex than building a new building," Wilkins said. "I'm sure he (Rochat) is a fine gentleman and knows how to run a business, but he doesn't know how to build things."

Prior to signing his lease in 1996, Rochat said he wanted a courtesy building inspection to determine possible code violations and potential renovation costs. He said that was akin to having a used car or boat inspected before purchase. He received courtesy fire and health-department inspections but said the building department initially turned him down, even though he was willing to pay for the service.

"The idea of a courtesy inspection is to know what you're getting into," Rochat said. "You don't want to get in over your head."

Wilkins said his office normally doesn't perform courtesy inspections before leases are signed because inspectors aren't supposed to help design renovations but are to check only for building-code violations. He said he reviews plans that are brought to his office, but again, only for potential code infractions.

"It's not my job to say, 'You put this over here and that over there,' " Wilkins said. "I don't get paid to review the project. I just review the code."

Wilkins said there were at least 12 inspections, including some from his own department, before Rochat submitted his plans to the city in September 1996.

Rochat said he didn't think the renovation would be significant enough to warrant an architect. When he began remodeling he believed he was following plans approved by the city.

He became agitated when inspectors kept claiming he violated those plans, including during the installation of an expensive kitchen exhaust system. Rochat also said the city changed the plans at least three times following arbitration hearings with the building department.

Wilkins said Rochat repeatedly violated codes because he didn't follow the approved plans. By the time Rochat opened for business, the city had conducted at least 92 inspections there, Wilkins said.

Rochat argued, though, that city building inspections were inconsistent. He said prior users of his Fourth Street location operated in violation of codes as did existing restaurants elsewhere in the city.

"I understand things have to be done a certain way, but why is the code good for some and not others?" he said.

Wilkins conceded that code violations were common, but that many were caused by changes made to buildings after they passed inspection.

"In every building there are code violations," Wilkins said. "It doesn't mean they're major violations. For instance, if you have dry wall and the nails are supposed to be six inches apart but they're seven inches apart, that's a violation."

Contrary to Rochat's opinion, Wilkins said his department supported downtown redevelopment and wanted small businesses to succeed. Paris, who frequently ate at Frogeez, said the Fremont Street Experience also wanted nongaming downtown businesses to succeed. But Paris also said he didn't think Frogeez was in an ideal location.

"He went into a location where other restaurants previously failed," Paris said. "That tells you something. It's not an area where people would go at night, plus the parking there is not that great."

Paris said he believed that situation could change in the next few years because the city landscaped Fourth Street and will add new buildings downtown. One is the 13-story Sun Plaza office building that will house the Las Vegas Sun and Nevada State Bank about a half-block from Rochat's former restaurant. The building will open next year.

"We didn't want his restaurant to close," Paris said. "A couple of years from now, it will be an OK area. Today it isn't. He was a little premature opening there."

But Rochat is pessimistic about downtown's future because he said the only small businesses that have succeeded there in the past 20 years are pawnshops, adult book stores and bail bondsmen. While new buildings are being planned downtown, including a new federal court building and county juvenile justice center, he said others are being abandoned.

"If you want to have a prosperous area, you have to have people who live there," Rochat said. "If you don't, you have no life. Nobody wants to live downtown now, and local people don't want to go downtown at night. On Fridays after 6 p.m., downtown is deserted except for the gambling."

Rochat said the only positive change downtown in the past several years for small businesses was the addition of police bike patrols.

"Anybody who tries to do anything downtown would be a fool today because the city is doing absolutely nothing for small business," he said. "I've had an expensive lesson."

Paris and others involved in downtown redevelopment conceded that the process was slow and would take many years to succeed. But he added that the Fremont Street Experience can anchor that redevelopment by helping to attract other businesses. One example is the $100 million Neonopolis@Freemont Street Experience, a shopping and entertainment center scheduled to open in 2000 on Fremont Street and Las Vegas Boulevard.

"It takes years for things to happen, but based on what I've seen of other downtowns, Las Vegas is moving at a good pace," Paris said.

A potential redevelopment bonanza is a combined 175 acres of vacant land owned by Union Pacific railroad and Lehman Bros. Holdings Inc. west of downtown near the Spaghetti Bowl.

But while the search for developers of that land continues, the redevelopment effort faces several other hurdles. Much of that task has been put in the hands of the nonprofit City Centre Development Corp., whose board is made up of area businessmen.

City Centre President Mike Forche said the board is exploring ways of bringing the downtown's older buildings up to code without pricing them out of the market for prospective businesses.

As it is, downtown has never been much of a commerce center. Forche said downtown has had to face the fact that financial institutions located there have placed several of their departments in less expensive offices elsewhere.

Another major concern is the lack of nongaming parking downtown.

Forche noted that modern office buildings elsewhere in the city provide four to five parking spaces per 1,000 square feet of office space, compared to about three parking spaces downtown.

"A bank won't lend money to a developer for a property that is under-parked," he said. "They want to make sure the loan is secure and that the building will pay for itself."

One solution, he said, is for the city to get into the parking-lot business as San Francisco has done.

"Cities can borrow money cheaper than a private developer can, so their costs of servicing the debt are cheaper," Forche said. "Getting the city to provide parking would be an incentive for developers."

That's important, he said, because downtown land prices are high for relatively small parcels. Forche said the price of downtown land has been driven up largely by greater demand for new government buildings.

Forche said City Centre also is exploring the potential construction of affordable, multifamily housing with an eye on consumers holding their first jobs out of college.

"We want to find out if there's a market for that downtown," he said. "But if we take on too much, nothing will get done."