Lobster Pound restaurant sold for $700,000 at auction

By Susan Mustapich | Mar 09, 2017

Lobster Pound Auction 3/9/17 from VStv on Vimeo.

Video by: VStv
Photo by: Susan Mustapich Dan and Carla Lafayette, owners of hotels throughout Maine, bought the Lobster Pound restaurant in Lincolnville Beach at auction March 9.

LINCOLNVILLE — The Lobster Pound restaurant was sold at auction March 9 for $700,000 to Dan Lafayette of Hampden, a hotel and restaurant property owner, who plans to reopen the restaurant by summer.

Inside the restaurant nearly 60 people gathered, but few were there to bid.

Bidding was opened at 11 a.m. at $500,000 by Stefan Keenan of Keenan Auction Co. of South Portland. Keenan struggled to push the bid to $750,000 and after receiving no bids at that amount, he dropped down to $600,000. No one bid on the lesser amount either.

At 11:10 a.m., Keenan announced a recess. The waiting crowd kept up a steady hubbub of conversation during the break.

When Keenan returned, he reopened the bidding, which quickly went up to $650,000, then $675,000 and finally $700,000. The sale included the property, buildings and equipment. The building and land are currently assessed at $909,900 by the town of Lincolnville.

Afterwards, Lafayette said he and his wife plan to reopen the Lobster Pound by Memorial Day. He said that unless the new minimum wage law is changed, he envisions the restaurant will have to use more of a self-service model and takeout business.

Lafayette said if the minimum wage law is changed, "we could hire more people." He talked about server wage increases coming in the next couple of years, and said he cannot afford to eventually pay wait staff $12 an hour.

Lafayette and his wife Carla both have childhood memories of enjoying Lincolnville Beach.

"The sentimental part was a big part for us," he said. "We were scared an out-of-stater might buy it and turn it into a house. So we felt like we could maybe keep it running as a restaurant."

Carla remembers clamming and taking the ferry to Islesboro, and once missing the ferry back and staying overnight on the island. Lafayette said he grew up on a farm in Winterport, and his mother, who was a divorced school teacher, could not afford a camp, but she would take the family to Lincolnville Beach. "That was a big, exciting day in my life, when I was little," he said.

He said he has no plans currently to convert the property into a hotel. "We don't tear things down, we try to come in and run 'em."

Lafayette said he hopes to use the Lobster Pound name, have some of the same menu items, but that they will not be able to offer the same, broad menu that the restaurant had. He also said they will not have a brewery, mentioning that the beer making equipment "had disappeared," and was not part of the auction.

He said the former owners did a great job. "It was a fabulous restaurant. We've heard nothing, but wonderful things about them."

Properties owned by the Lafayette's include: Holiday Inn by the Bay in Portland, Blue Nose Inn and Wonder View Inn in Bar Harbor, Fireside Inn & Suites in Auburn, Bangor, Belfast, Portland and Waterville, and in Nashua, Gilford and West Lebanon, N.H., the Sea View Inn and Waves Oceanfront Resort in Old Orchard Beach, the Norseman, Seacastles, and Aspinquid Resort in Ogunquit, the Boothbay Harbor Inn, Tugboat Inn, and Fisherman's Wharf Inn in Boothbay Harbor, Best Western White House in Bangor and the Senator Inn in Augusta and Lafayette's Oceanfront Resort in Wells.

The first Lobster Pound eatery on Lincolnville Beach dates back to the 1920s and was little more than a lean-to with a lobster cooker. The restaurant has been in the McLaughlin family since 1958. Before filing Chapter 7 bankruptcy in November 2016, Dick and Patty McLaughlin had owned and operated the Lobster Pound for 44 years.

The longtime owners cited the 2008 stock market crash and ensuing economic downturn, increasing overhead costs that ate into the profits of the restaurant's six-month season, and the loss of 26 parking spaces to eminent domain around 2006 for a state beautification project at Lincolnville Beach, as factors that eventually led to the bankruptcy.

A business partnership that added Andy's Brew Pub to the restaurant in 2014 in order to extend the restaurant's season and attract new customers was unsuccessful. The restaurant was on the real estate market for a year with the Daigle Group, prior to closing its doors at the end of the 2016 season.

Courier Publications reporter Susan Mustapich can be reached at 236-8511 or by email at smustapich@villagesoup.com.

 

Comments (15)
Posted by: Maggie Trout | Mar 11, 2017 19:23

Yeah, sure.



Posted by: Kenneth W Hall | Mar 11, 2017 18:24

What businesses have been maintaining insufficient staff?  Where are the facts coming from?  Who and how many are applying?  What standards are used to decide if it is not worth applying?

 

I would love for people that accept benefits from the Government no matter what they are, to be accountable for them in someway.  Work in someway.  It is people that choose to not work because it is more profitable to stay at home that if capable to "earn" the benefits.  After all "work" is a four letter word.



Posted by: Maggie Trout | Mar 11, 2017 17:15

Okay.  But you know what?  Even at minimum wage, businesses have been maintaining insufficient staff, and it isn't because people don't apply, unless they know it will cost them more to work, one way or another, than to listen to babbling brooks or wind.



Posted by: Ronald Horvath | Mar 11, 2017 16:50

"The only time you should look in your neighbor's bowl is to make sure they have enough.  You never look in your neighbor's bowl to see if you have as much as them."  -Louis C.K.



Posted by: Kenneth W Hall | Mar 11, 2017 15:58

I just enjoy a healthy debate and I have to admit my original answer was full of sarcasm, however it was also very factual.  Personally, I much prefer the sound of a babbling brook, but skimming across the water in a sail boat listening to the wind is extremely therapeutic as well. So I agree the "public" should spend more time enjoying what God provided on this earth vs what another is earning.  :-)



Posted by: Maggie Trout | Mar 11, 2017 15:36

And, really, if it is pesky employee costs that are the problem, just as patients are the pesky problem in medicine, and "the public" is the problem, and deliveries are to be made by drones, and brick and mortar stores vanish, then I guess there's not a whole lot left to worry about, unless you want to focus on religious damnation or reward, which is preposterous... so why not have a good day listening to the wind.



Posted by: Kenneth W Hall | Mar 11, 2017 15:03

Yes people continue to open restaurants, and 8 out of ten fail in the first five years.  Try going into a bank and ask them to borrow money to open a restaurant.

 

The difference between profit in the hospitality business is different then in a restaurant.  I am sorry if I used the word "sales" vs "revenue".  I just get upset when people assume a waitress does not make a 'living wage".  Sort of do not judge unless you have walked in ones shoes.

 

In all honesty the current tax system will allow a write off for losses at this business to off set the profits made at other properties but I am not his accountant so I wouldn't know.  How ever the new law went into effect and Thistles in Bangor and Anton's (sp) in Scarboro are examples of it not worth remaining in business.  There are others but off the top of my head I can recall them being in the BDN stating that it is not worth it any more.  Restaurants profit margins are less then 5% net profit so when line items go up the profit goes down.  People get into the restaurant business because they love the people and cooking and not to get rich.



Posted by: Maggie Trout | Mar 11, 2017 13:27

These comments would suggest, then, that no one open a restaurant.  And yet they do.  One element missing from the expenditures is revenue.  Minimal 300% markups on food and at least double the cost of alcoholic beverages must do something to offset the cost, as must business tax deductions.  Mr. Mazzeo makes the point that the new owners own and operate a large number of properties.  There must be some reason for doing so, and taking on yet another, does give one pause.  (His comment certainly did not warrant such an intense response).



Posted by: Kenneth W Hall | Mar 11, 2017 00:01

Sandra, it is the change to the "well oiled machine" that is changing the way the machine has been for years.  The elimination of the tax credit is what is changing the way waitstaff is paid.    Mr Lafayette is right about the new law and how it is changing the restaurant business.  Fewer employees will be hired as he said.  That is why the misconception of the "living wage" post needed to understand that the tip credit has worked for over 50 years.  If it aint broke don't fix it. I  totally agree that both the Lafayette's and Dick and Patti deserve the best for being such advocates of the food service industry.



Posted by: Sandra Schramm | Mar 10, 2017 20:57

I wish the new owner's well. I worked for Dick and Patti as well as Dick's parents. It is a hard seasonal business. The posts here are so unnecessary.  Wait staff my seem underpaid but even in 1965-66 I made a very decent living waiting tables at The Pound and later many other establishments. That low rate of labor paid to waitstaff is surely offset when you consider that the establishment reported income at full minimum wage to factor in the tips. So the waitstaff still had unreported income. This is one way that waitstaff works as a well oiled machine. The ones get weeded out fast who are not producing.

From what I know of the Lafayette's they work for their money. If you invest you deserve a return. It often takes twists and turns and yes one gets out if the return is not forthcoming. I believe this restaurant will survive just fine.  I hope that Dick and Patti get some much well deserved time for themselves. They employed many people over the years and we were well treated.

 

 



Posted by: Kenneth W Hall | Mar 10, 2017 20:26

That's right Mary, show me a server not making in excess of $20 an hour and I'll show you somewhere you will never want to dine at again.



Posted by: Mary A McKeever | Mar 10, 2017 17:06

I hear you Ken Hall! It is frustrating to try to make a living no matter what the commercial endeavor. Taxes are so high and minimum wages in Restaurant business is not reasonable. Remember tips? My step-grandson made a few hundred dollars a night on tips in a restaurant  while working his way through college. It helped. I feel for the loss of the landmark restaurant.



Posted by: Kenneth W Hall | Mar 10, 2017 09:39

Francis, may I ask where the fact of him not paying a living wage is coming from?  What about his living wage?  Seeing as the Lobster pound is going to be seasonal that makes him making nothing from that building for 7 months a year.  Well wait! Not just that he will be making nothing which I assume is below what YOU would consider living wage but that property will be generating EVERY month a $4524 commercial mortgage as well a $1000 EVERY month for flood insurance.  Oh Yes we have just begun his living wage or lack there of as an employers unwilling to pay a living wage!  What about the liability insurance of another $1000 EVERY month and oh yes! Don't forget the taxes which pay for those unwilling to work another $1000 EVERY month. SO seven months out of the year he is making....wait for it...BELOW and I repeat BELOW a living wage by MINUS $52,668.  Yes it is true!  The OWNER will be making $52,668 BELOW  -$0-  I am assuming zero is not a living wage correct?  What is a living wage for seven months a year?  It can't be a negative $52,668 can it?  I wonder how much food he will have to buy to make up for that negative $52,668?  Oh wait, he has to  pay for the food too!  So every 35-45 cents on the dollar he makes selling the food has to go to buying the food.  Oh wait, then he has to pay for advertising which is another 3 cents on every dollar. Then let's add another 8 cents for utilities(lp gas, electricity,telephone office supplies etc).  Oh and then there is the banks dipping into his pockets as well!  Give them up to 4% of every dollar charged to the banks depending on what kind of credit card the customer chooses to use.  We haven't even address the costs of legal and professional fees, licenses and permits cable/internet fees, water, sewer fees.  Oh, what about donations to the community?  I have no doubt his donations to the communities he is in far exceed the list of properties he owns.

Then add another $37,620 for his mortgage insurance and taxes for the 5 months he is open.  How far in the hole is he honestly before he opens his doors???  That "hole" is "his living wage"  BELOW what most call a living wage and these are facts that ANY University will teach.

 

OH yes, I forgot one critical piece of the pie the labor for his business to run.  The living wage is what actually.  Restaurant labor runs at 35% so let's total and see what we have so far.  Yes it is true, we are at 95% of every dollar does not go to the owner who holds ALL THE RISK.  Oh sugar I forgot to add in the payroll taxes which is another 3%.  Now he is down to 2 cents on every dollar of sales can go to the $90,288 hole from the building expenses.  So that means......the Lobster Pound needs to gross $4,514,400 BEFORE the owner STARTS to earn a PROFIT!  That is $29,125 a day in sales.

What is an owner suppose to make as a living wage for risking $700,000?  Are you willing to risk everything you have to provide jobs in the restaurant industry like him to provide a living wage?

 

PS I didn't think Trump University....well don't get me started! LOL



Posted by: Norman D Carver | Mar 09, 2017 18:30

I have an idea I would rather have what they owe than what they really own but they have the courage to put it all out there on a limb more power to them.

 



Posted by: Francis Mazzeo, Jr. |

They own all those properties yet they cannot afford to pay a living wage? Must be graduates of Trump University.



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Susan M Mustapich
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Susan Mustapich is assistant editor of The Camden Herald. She has lived in Knox County since 1995 and worked as a reporter at both The Camden Herald and The Courier-Gazette in the past, covering Camden, Rockport, Lincolnville, Hope, Appleton, SAD28/Five Town CSD, Knox County government and the courts . She returned to the Herald in March 2016.

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