The owner/operator of the Kwik Way hamburger drive-in at 550 Lake Park Avenue—Alex and Charlie Hahn—are trying once again to replace the ailing, unprofitable business with a major hamburger chain.
Their earlier attempt was in 2004, when a McDonald’s franchisee was poised to take over the Kwik Way’s building. This attempt was ultimately stymied by the City’s Planning and Zoning Division and the Planning Commission, which responded to strong opposition to the plan from the community.
[For more information about the “Say no to McDonald’s on Lake Park Ave!” campaign see this archive.]
If the Hahns get their way, the Kwik Way will become the next location for FatBurger, a Santa Monica–based corporation with 86 locations in 14 states and Canada.
The location would be open from late morning until as late as midnight, but would not be open for breakfast.
FatBurger is marketed as a “quick casual, take-out and sit down hamburger restaurant.” FatBurger prides itself that its food is freshly prepared and cooked to order. “We are not fast food,” said Seymour Floyd, of FatBurger’s real-estate division. “We cook to order.”
Burgers, rings, and hand-scooped shakes
FatBurger’s signature products include hamburgers, chili dogs, steak fries, fresh-cut onion rings, fresh-squeezed lemonade, and hand-scooped ice-cream shakes. Their menu also includes a grilled-chicken sandwich, a turkeyburger, and chili cheese fries.
FatBurger’s largest standard hamburger, the Kingburger, is a half pound (net weight before cooking), although “double your patty” is an option for all items. Their smallest hamburger is called “Baby Fat.”
FatBurger also sponsors the occasional “Triple King Challenge,” which involves eating one triple Kingburger:
It may not seem like much, but it’s a pound and a half of meat, all the fixings, plus a bun. Trust us—it’s a challenge.
Although some of its advertisements have been dismissive toward vegetarians—suggesting that vegetarians should go eat a tree, while their carnivorous counterparts enjoy a FatBurger, or “Do you really think man clawed his way to the top of the food chain to eat soy?”—their menu now includes a veggie burger. Ironically, their only salad menu entry, the Fat Salad Wedge, is not vegetarian, being topped with diced bacon.
FatBurger would mainly stay within existing footprint
The franchisee’s plan would be to work primarily within the footprint of the existing masonry-block building, with the exception of an additional storage area at the rear.
Although the current Kwik Way has no interior seating for customers, the new FatBurger would have seating inside for 28 customers, in a combination of 2-person, 4-person, and 6-person booths.
The creation of this seating within the confines of the existing footprint is made possible by more-efficient use of the space, according to James Heilbroner, the architect for the project and president of Architectural Dimensions in Walnut Creek.
Drive-thru window would be utilized
FatBurger would continue to utilize the Kwik Way’s drive-thru window to serve customers who arrive in and stay in their cars, in addition to those who walk up to pick up or come to sit down.
Unlike fast-food chains such as McDonald’s, the drive-thru window doesn’t drive a FatBurger’s business, FatBurger’s Floyd said:
Our concept is not conducive to drive-thru. Because we cook to order, our hamburgers take from 8 to 12 minutes to cook. No one wants to wait in a drive-thru line that long.
Mr. Floyd said they encourage their customers to call, fax, or text message their order and then use the drive-thru for picking it up. Mr. Floyd said that only eight or nine of their locations nationwide have drive-thru windows.
Despite Mr. Floyd’s statements de-emphasizing the importance of drive-thru business, the franchisee—Chester McGlockton, head of All Pro Eatery d/b/a FatBurger—was clear that they would not consider closing the drive-thru window. They “consider [the presence of the drive-thru window] a gift,” and consider it particularly important because the seating for 28 customers is a much smaller capacity than the typical FatBurger location, which seats 74 customers.
Traffic associated with the drive-thru window—particularly the possibility that cars would queue into highly trafficked Lake Park Avenue—was a major, though not the only, concern of the Planning and Zoning Division during its 2004 review of the proposal to replace the Kwik Way with a McDonald’s.
City staff were concerned that the drive-thru would not only create congestion on Lake Park Avenue but would interfere with pedestrians, because Lake Park Avenue “is an important pedestrian connection between the Grand and Lakeshore Avenue shopping districts.”
Commitment of 15 to 20 years foreseen
Tuesday night, the Kwik Way owner/operator, Alex and Charlie Hahn, and representatives of FatBurger corporate and the franchisee met with some members of the community—most of whom had been involved in organizing the community’s opposition to the planned McDonald’s in 2004— at a meeting convened by city council member Pat Kernighan.
When asked, none of the parties to the proposed deal disclosed how long the lease would last. (It is possible that this term had not yet been worked out.)
However, FatBurger’s real-estate representative said that any time FatBurger opens a new location, they look it as a long-term investment. “15 to 20 years,” Mr. Floyd said.
Recent proposal for a mixed-use residential-over-retail development forms the backdrop
The Hahns’ resurrection of a plan for a new hamburger restaurant on the site, after the community’s rebuke of McDonald’s three years ago, takes place in a context where many in the community have since formed very different hopes and expectations for the site.
Less than a year after the Planning Commission rejected the Hahns’ appeal of an adverse determination by the City, developers Dave Latina and Michael Simmons, of Paramount Development Group (PDG), began working with the Hahns with the goal of developing a mixed-use development on the Kwik Way site, with retail on the ground floor and several floors of condominium residences above.
PDG invited significant public input into their design: first with a series of meetings with a large group of neighborhood representatives that provided initial comments, then with outreach at the Grand Lake Famers Market on two consecutive Saturdays, and culminating with a public meeting in Barnet Hall of Lakeshore Avenue Baptist Church on October 24, 2005.
The dramatic turnaround in fortunes for the site—both in substance and in attitude, where the Hahns and the community transformed from adversaries into partners—prompted a local newspaper to dub the process the “Miracle on Lake Park Avenue.”
Despite the high hopes for the development’s success, that partnership dissolved in February 2006, and the Hahns entered into negotiations with another developer, Tom Peterson, of Lakeshore Partners. That path, too, hit a dead end.
[For more information on the dissolution of the Hahn-PDG partnership and the negotiations with Tom Peterson, see Pamela Drake’s “Local developer: mixed-use development on Kwik Way site still works.”]
Community members keep alive hope for a comprehensive development
Notwithstanding protestations at Monday’s meeting by Alex Hahn that a mixed-used development is not feasible, some community members expressed their preference for a mixed-use development—that they said would provide more-vibrant retail and needed housing and heal the gap in the pedestrian connection between Grand and Lakeshore Avenue business districts created by the Kwik Way’s driveways and drive-thru traffic—rather than locking in an automotive-oriented suburban-model drive-thru facility for the next 15 to 20 years.
City council member Pat Kernighan agreed that a mixed-use development was preferable but doubted whether it was economically feasible in the near term given her assessment of the current housing market.
[Pamela Drake reports that Dave Latina has said recently that “No doubt the market has cooled but we have not seen downward pricing in the Grand Lake area.… The Grand Lake area is not overbuilt and almost no new construction is being offered. We continue to feel this is a viable project.” See “Local developer: mixed-use development on Kwik Way site still works.”]
When a community member suggested that it would be better to have such a mixed-use development with FatBurger as a ground-floor retail tenant, franchisee McGlockton agreed, saying he would prefer that, too, but that it was up to Alex Hahn to allow such a development to go forward.
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Comments
Dear Jim Ratliffe & Community Members,
Thank you once again for participating in yet another Stakeholder's meeting last Tuesday, January 29th, 2007. Your input is always appreciated and I congratulate you in paving the way forward for the Cleveland Cascades Project. The Grand / Lakeshore community values your leadership and I have learned a great deal from your activism in our beloved City of Oakland. During the general elections in November, I remember the excitement when we huddled around your laptop, viewing the latest election results from the Alameda County website. Once again, I applaud you for all you have done for the Grand/ Lakeshore community. Since 2005, I have volunteered on beautification projects such as Earth Day at Morocom Rose Garden, Splash Pad Park, planting amazing flowers off the 580 eastbound Grand Ave off ramp in a joint effort with Grand Lake Grime Busters and Cal Trans, assisting with the new renovations for Lakeview School and helping Oakland's teachers for the 1st day of school at Garfield Elementary. We have accomplished a lot together and there is still more work to do. I envision one day our Grand Lake community could work with community groups in San Antonio with approval from the City of Oakland to build a revitalized San Antonio Park with a computer lab and after school programs.
I want to address some of the questions that were raised by your Newswire submittal to the Grand Lake Guardian. I want to remind my fellow neighbors that the Kwikway property is private property, unlike the Oak to 9th project in which required public grants and city property. Kwikway continues to be unprofitable and because of a declining housing market, we chose to go with a cook to order restaurant with indoor seating such as Fatburger, since during the community meetings on the proposed mixed use development, neighbors mentioned to us that they wanted a "place where neighbors could gather". Currently, Kwikway is only a take out and drive thru business. I encourage the community to see that Fatburgers chose Oakland over San Francisco. The following are the categorized responses from the Hahn Family addressing the issues that Mr. Ratliffe and others have raised:
1. Fatburgers' Menu: Fatburger has one of the leanest meats compared to other competitors. Here's a quote from their website "Fatburger is a big, hearty, juicy, gourmet hamburger that uses the highest quality USDA approved beef. Interestingly, a local NBC News program conducted an independent test in 1990 to determine the fat content of the hamburgers prepared by the major chains in Los Angeles. They found that Fatburger served the leanest hamburger of them all." As opposed to Kwikway which does not have any vegetarian burgers at all. Fatburger has veggie soy burgers, turkey burgers, chicken burgers, small burgers for children and their new salad concept may have bacon, yet I believe if a customer wanted to omit the bacon bits from the salad, Fatburgers would probably be more than happy to accommodate the customers' wishes. I believe the ad campaign for vegetarians was for humorous intent, as opposed to a 5 star popular chef and author Anthony Bourdain who quotes in his book A Cooks Tour-"I hate vegetarians". Not to undermine nor argue with Mr. Ratliffe but I think we should hold the 5 star chefs such as Anthony Bourdain accountable as well, if such points are being made against our new Tenant.
2. Architecture: I am glad that Fatburger selected James Heilbroner as their primary architect, because of his experience in restoring phenomenal Oakland landmarks such as the Rotunda Building and the Fox Theatre.
3. Drive Thru & Times: Currently there is a drive thru at Kwikway. Contrary to McDonalds' where they are now open 24 hours including breakfast, Fatburger will open in late mornings and close around 12 midnight on the weekdays. Fatburger did state that they are "cook to order" concept; hence the drive thru window would actually serve as a quick pickup window, for pre-orders via phone and now email. Fatburgers has a 1/3lb. patty that requires 10-12 minutes to cook. Fatburger will also provide greeters to keep the traffic moving or encouraging patrons to park and await their orders. Unfortunately, Kwikway does not have the capacity to provide personnel that could greet motorists and direct them appropriately. Fatburger's primary revenues comes from foot traffic and walk in takeouts.
4. Job Creation: The Honorable Mayor Ron Dellums has encouraged many businesses to provide jobs to Oakland's Youth. Fatburger will hire 20-25 Oakland citizens to join their company, with management opportunities that have health care benefits. In 2006 the City of Oakland had a spike in violence with 148 homicides. I firmly believe that our youth needs employment opportunities when available, especially since cities have become more self reliant as a result of deficits within the State and federal funds becoming non existent for urban centers across the United States.
5. Support for Minority Entrepreneurship: What makes Fatburgers so exciting is that they're 50 year tradition was first started by an African American woman by the name of Ms. Lovie Yancy. Currently, the Fatburger company and franchisees include many prominent African American celebrities such as : NBA Hall of Fame recipient Irving "Magic" Johnson, Bay Area rapper Earl Steven aka E-40, talk show host Montell Williams, music producer Pharrell of the Neptunes, Academy Award Winner Queen Latifah and at the proposed Lake Park location former Oakland Raider Chester McGlockton 1995-1997. The Hahn Family who are Korean American entrepreneurs themselves fully supports other minority groups that can provide inspiration to their respective communities. Mr. McGlockton is committed to the youth of Oakland and wants to give back to the community. Chester has also been very generous to the Oakland Unified School District and plans to support Oakland's public schools. Chester McGlockton is a remarkable positive role model that Oakland's youth could look up to.
6. The Housing Market: I may be wrong at times, but according to the news articles that I have read and will share with the community on this forum, the East Bay Housing market is in a downward trend. Unfortunately, the proposed mixed use project seems unfeasible because developers who have the capacity of completing such a complicated project look at extensive research and articles such as these:
a. "The likelihood of home prices dropping over the next 2 years is 61 percent in San Joaquin County, 60 percent in the East Bay Area and 59 percent in the San Francisco metro area, which includes San Mateo County. Nationwide 34 percent"- a study conducted by the PMI Group in the article" Foreclosure rates rise as housing market cools" – by Eve Mitchell, Business Writer The Oakland Tribune, January 24th, 2007
b. "The forecast by Moody's Economy.com predicts the 4th and 5th biggest price declines will occur in Merced and Stockton, down 16.1% and 15.7 %, respectively by 2008-09. Other markets expected to decline include Vallejo-Fairfield (down 12.1 % by mid 2009) Oakland, Fremont-Hayward (down 6.4 % by mid 2008) the report presents one of the starkest views yet of the housing slowdown that has been gathering force in recent months. The Westchester , PA., forecasting firm projects that the median sales price for an existing home will decline in 2007 , 3.6 %, which would be the first decline for an entire year in home prices since The Great Depression of the 1930's. " – "East Bay housing projected to drop in market value" by Martin Crutsinger, Associated Press , The Oakland Tribune http:// www.insidebayarea.com/search/ci_4439187
c. "The National Association of Realtors said existing homes sales slipped to an annual rate of 6.30 million units pace in July. In addition the stock of unsold homes rose 1.5 % to 3.92 million units." – "Home Prices Drop for 1st Time in Over 10 Years" – Reuters, September 24th, 2006
d. "Compared to a year ago, the Bay Area's median home price fell by 0.8 %, or $5,000. The median price in Alameda County fell 0.7 %. The number of homes sold in September 06 in Alameda County alone was 1,624 compared to September 2005 at 2,300, in which was a -29.4% change."-study conducted by Dataquick Information Systems article by Eve Mitchell, Business Writer The Oakland Tribune , October 18th, 2006
e. The Hahn Family was also affected by the housing market decline hence the nationwide luxury condominium Toll Bros. pulled out of the proposed mixed used project on another parcel that my family owns. Here's the article: "Toll Bros. Oakland high-rise proposal at risk"- The San Francisco Business Times, September 29th, 2006.
I may be mistaken, but these reports are fairly recent reports in regards to the status of Oakland's housing market. Councilmember Kernighan as well as other city officials and business leaders could also confirm the downtrend of the Oakland housing market. The Hahn Family implores our neighbors to realize that as business owners we have to make a return on investment. I don't think the neighborhood would be willing to grant my family written personal guarantees that the units would sell immediately after high acquisition costs i.e. (money the lead developers never raised to acquire the Serenader, whereas the Hahn family had to pay way above market value for the parcel in order for the project to work) as well as costly change orders during construction and staff for marketing those units? The community needs to understand that the Bank of America is entitled to 30 parking spaces and has a legal right to extend their options as a Tenant under our current Lease Agreement. Bank of America has also serviced that location for nearly 30 years and didn't want to give up their legitimate rights at that location. Unfortunately, the Hahn Family's options are very limited, hence we chose Fatburger, since our business is primary retail not housing development. The Hahn Family invested too much time and money in this process and needs to make a return on investment. Please understand that our family has suffered numerous economic and personal hardships while running the Kwikway, and do recall I was a victim of a hate crime, four days after the Planning Commission revoked the permits for McDonalds.
Once again, I wanted to thank the Grand Lake community for your continued involvement in making Oakland a better city. Thank you for your support and prayers for my brother Alan Hahn who managed to beat the throat cancer, but now has another fight ahead of him, since he has been recently diagnosed with Stage IV lung cancer. The doctor said he has a 15% chance to survive, so please consider my courageous older brother who encouraged me to look past the racist writings that were put on the Kwikway door and work with the community. Alan said "Charlie I know your upset but show them as you showed me that you're a man of compassion who cares about Oakland" Later on that week in May 2005, I called Chuck Johnston and he got me involved at the Morocom Rose Garden on Earth Day, one of the best decisions I ever made in my life. Alan Hahn was the one who encouraged my family to talk with developers for the mixed use housing project and was responsible for acquiring funds in aligning the parcels together. As kids, my father and mother worked hard as new arrivals from Korea, so my brother pretty much raised me as latch key kids growing up in El Sobrante, CA. Please understand that my brother and I are very close as Jack and Bobby Kennedy were, and I appreciate him in raising me as a good man. Now I appreciate every minute I spend time with my brother, and I don't know what I would do without him. My brother runs 4.5 miles per day and is staying positive about his condition. Alan's will to endure, is perhaps similar to many Oaklanders who our fighting the hardships of inner city life everyday. In closing, the real "Miracle at Lake Park" is this neighborhood and our elected officials, who care about our diverse communities and strive to make things better for all. I am encouraged by the miracles this neighborhood has showed me, and is why I promise you I will do my best in fulfilling the dreams of our children in this magnificent city called Oakland.
I know people are concerned about mixed-use development, but the kwikway site meets a lot of the requirements that many of my friends have in a new place.
1. Close to transit
2. Close to outdoor space
3. Close to a grocery store (Safeway and soon to be Trader Joes within a 10 minute walk, that is amazing)
4. Close to the farmers market
5. Close to shopping and restaurants
6. Close to the freeway
The only other thing to deal with…put in enough parking, and it would be a perfect spot. I think the developers should reconsider. On the whole the market maybe heading down, but consumers are more picky. If something offers all of the important amenities in a well-designed, well-located, well-priced development, the buyers will come running. I bet if you polled 100 late 20s to early 40s childless singles or couples, they would be very excited about that sort of development! The real barometer: look at the new development on Piedmont and Pleasant Valley, the Bridgecourt conversion in Emeryville, and the new developments around 40th, Adeline and MacArhur. If these do well, then it should be pretty clear that the Lake PArk mixed use would be a great addition.