Owners of the posh Union Trust steak house in Center City vow to remain open after filing for bankruptcy protection last week.
Union Trust, which opened in early 2009 in the former Jack Kellmer jewelry store at 717 Chestnut St., did not disclose its assets and liabilities in its filing under Chapter 11 of the bankruptcy code, which would allow operations to continue while a judge sorts out claims. A list of creditors is expected to be included in further filings due April 14.
The restaurant's two officers, developers Joseph Grasso and Garrett Miller, said in an interview Saturday that business was stronger than it had ever been, that financial controls had made Union Trust profitable, and that the filing was intended to "bring order to a chaotic situation." They said they wanted to use the court to set up a repayment schedule for banks, investors, and companies involved in the construction and, as Miller said, "to take the emotion out of it."
Grasso said $12 million had been invested in the project, including $2.8 million for the onetime bank building, designed in the mid-1920s by Paul Philippe Cret. Grasso and Miller's Walnut Street Capital controls the building.
"As owner of the building, I had to take over the business," Grasso said. "I have the majority of the investment. As the partnership sank deeper into debt, it was clear to us that it wasn't going to survive."
Court records show the restaurant and its affiliated companies have been beset by judgments and claims since it opened, including a $4.6 million judgment filed last summer by TD Bank and a $13,685 tax lien filed Friday by the city.
Grasso and Miller said the business was current with food suppliers and other vendors, who at one point were owed $80,000.
"The business is the golden goose," Miller said, and a reorganization plan "will remove the noose from the golden goose."
The project was started in 2007, but anticipated financing from the Philadelphia Industrial Development Corp. did not materialize, Grasso and Miller said.
Union Trust's opening coincided with a soft economy and new, well-funded competitors across town, including Del Frisco's and Butcher & Singer.
In September, Grasso and Miller assumed sole control of the restaurant from a limited-liability company whose members, at one time or another, included restaurateurs Terry White, Ed Doherty, John Dunfee, and John Frankowski, all of whom helped conceive the restaurant. They are not listed as members of the current Union Trust Philadelphia L.L.C.
White said Saturday that he was removed from the operation in 2009 and was not paid or indemnified from claims against him personally. Grasso and Miller said that was not the case.
White said he expected litigation to follow. He said his home, used as collateral on two loans, was on the line. "It's going to be dirty, nasty, ugly," White said.
The restaurant's neoclassical-meets-modernist grandeur, including 45-foot ceilings, appears in the current Bradley Cooper-Robert De Niro movie, Limitless, which was filmed in Philadelphia.
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