Local News

Depot Derailed as Nightclubs Close

Posted November 13, 2007 12:36 p.m. EST
Updated November 13, 2007 11:54 p.m. EST

— Three nightclubs in the recently restored warehouse district west of downtown Raleigh closed without warning last weekend, leaving dozens unemployed and the area's future in the air.

Trucks packed up equipment from The Hurricane, Blazin' Saddles, and Soho East over the weekend. Half-empty beer bottles still sat on bars inside the clubs on Tuesday, and unhooked cables hung from the walls where plasma televisions were once located.

"Our schedules were posted. Literally, it's like they just snuck out in the middle of the night and just left," former employee Lelia West said

"It's just like we worked on a project together, and it's like it went away. We never did anything," former employee Carey Kidd said.

The three West Davie Street clubs were part of The Raleigh Depot, owned by Rochester, N.Y., businessman Ronnie Davis. The project was part of an effort to revitalize the warehouse district near the Amtrak rail station west of downtown.

Six years ago, the North Carolina Railroad Co. spent more than $2 million to restore the 1912 Southern Railway freight depot. The building sat empty for several years before Davis leased the property last year and began outfitting it for the three clubs.

The Depot opened to great fanfare in August, with a block party to attract people downtown. But an incident involving country-rock singer Uncle Kracker drew even more attention to the area.

The singer, whose real name is Matthew Shafer, was arrested at a Cary hotel after a woman accused him of groping her in a downtown Raleigh bar after he performed at The Depot block party.

Shafer pleaded guilty in September to a misdemeanor assault charge and was sentenced to a year on probation.

Unemployed workers said Tuesday the incident had very little to do with closures.

As he walked though the abandoned clubs Tuesday, plumbing contractor Don Luther said a financial dispute between Davis, the NCRR and the project's general contractor led to the sudden closures.

"We were supposed to be paid five days after the job was completed. That was our guarantee by the railroad," Luther said, noting he is still owed $49,000 for plumbing work he did in the clubs.

"Everybody backed out of it," he said. "We've got a lien going right now on this building and the owners."

NCRR officials issued a statement that said Davis "apparently has abandoned the business in Raleigh" but hasn't provided any notice of termination of the lease.

"Contractors did work at the direction of (Davis') company. NCRR does not have a contract with general contractor or subcontractors," NCRR spokeswoman Kat Christian said. "We're concerned they are not going to get paid and hope it will be resolved fairly quickly."

Ben Kuhn, an attorney for Davis, declined to comment on any financial dispute. He said Davis was sorry for leaving about 40 full- and part-time workers without jobs and leaving subcontractors with unpaid bills.

"It has been our intention to add to and continue Raleigh's development. We regret any hardship or impact immediate closure had on North Carolina Railroad Co., subcontractors, employees, residents and patrons," Kuhn said.

David Diaz, president and chief executive of the Downtown Raleigh Alliance, said he doesn't think The Depot's closing will adversely affect efforts to bring more business to the warehouse district.

"It appears to be an isolated incident," Diaz said.

The NCRR hopes to find new tenants for the spaces formerly occupied by the clubs once the lease will Davis is resolved, Christian said.

But new tenants won't open in time to help Mary Shelton, who recently booked an event at The Depot for December.

"I was coming by to secure it, and there's nobody here," Shelton said. "(I was) shocked. The doors were locked, (and) the contractors let us in. They said, 'There's nothing here. There's nobody here. They've all packed up and gone.'"

With the new downtown convention center and hotel scheduled to open in less than a year, leaders had high hopes on this area becoming a well-established nightlife destination.

"Certainly a setback for the warehouse district and a little bit for downtown Raleigh,” said Dennis Edwards, president and chief executive of the Greater Raleigh Convention and Visitors Bureau. “Losing these three businesses is a loss, but hopefully we've got time to replace them.”

“We have about 160 restaurants and clubs. So having two or three of them close down isn't that big of a deal overall,” Raleigh Mayor Charles Meeker said.

Although employees weren't given any notice about the closures, Dave Jackson, a bar manager at The Hurricane, said the moves didn't surprise him.

"I think it was just a little too big for Raleigh at this point in time," Jackson said. "Probably two years from now, it would have been a better idea."