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Nov 23, 2015 9:46 AMPublication: The Southampton Press

Southampton Publick House Owner At Crossroads, But Sees Opportunity For Growth At New Spot

The Southampton Publick House was established in 1996.  DANA SHAW
Nov 23, 2015 4:25 PM

Don Sullivan, owner of the Southampton Publick House, is at a crossroads.

The historic structure at 40 Bowden Square has been a gathering place in Southampton Village for a century, the last 20 as the Publick House. But the sale of the property last month to an investment group begins the countdown to a new use of the village site—as well as an ambitious future for its long-term tenant, a microbrewery, tavern and restaurant that has operated there since 1996.

But it’s a transition Mr. Sullivan said he’s been planning for years, and one he welcomes.

“It’s an opportunity—a good one, a necessary one, both from the standpoint of the restaurant and of the brewery,” Mr. Sullivan, 54, said recently in the dining room of the restaurant, which will be moving to a new spot, possibly sometime in 2016. “I’m very confident, happy to say, that we’re not going anywhere. The business has not sold. We will transition into a new location.”

Where that new location will be remains a mystery: Mr. Sullivan says he’s close to deciding between two properties not far away, both near the Southampton Village line, but will not identify either. He did say that each offers something he sees as critical to the future of the operation: up to 15,000 square feet, more space to allow an expansion of the microbrewery to brew more draft beer in-house, which then would be sold commercially throughout the region.

At the same time, the Publick House’s owner says he has his eye on a dark horse option, a well-known, high-profile property on Jobs Lane that he said would be “perfect” for his needs, as well as the downtown business community. The only question: Would village officials ever consider his proposal?

The Hard Way

A firm called Bridgehampton Equities purchased 40 Bowden Square earlier this month for a reported price of $3,625,000 from Pascal Associates of Garden City. The new owners have said they bought the site on behalf of the Woodbury-based DiNoto Group, and the two companies will work together to keep the Publick House as a tenant for the short term, and renovate the building to “bring it back to its original glory.” Beyond that, they have not revealed how they plan to use it.

The building—there are actually two separate buildings, one built in the late 1800s, the other in the early 1900s, which were eventually merged into a single structure—started out as a boardinghouse, but with a reputation: Its back room was said to be a speakeasy during Prohibition. Starting in the 1930s, Herb McCarthy established a legendary tavern and restaurant, which continued through the mid-1980s. It continued under several other names, Bowden Square and Sfuzzi among them, until Mr. Sullivan and his two brothers, Jim and Kevin, established the Publick House in 1996.

Mr. Sullivan, who bought out his brothers 10 years ago, has always leased the space on Bowden Square. He has tried to buy the building three times, and three times he has come up short.

The first was in 1996, when the business first opened. The Sullivan brothers, with a partner, Jack Pascal, planned to buy the property and open the microbrewery restaurant. But Mr. Pascal, through his Garden City-based company, Pascal Associates, completed the purchase on his own, for $950,000, and offered a 15-year lease to the new business, which left the tenant responsible for maintenance, repairs, utilities and taxes. “We made a poor decision in accepting a lease after that,” Mr. Sullivan admitted. “It was not a good decision.”

The second time came in June 1996, when he had a tentative agreement to buy the building, but the deal never went through. He decided to keep the lease and bought out his brothers at the same time. “That’s the second time I should have walked away,” Mr. Sullivan admits now.

After the lease was extended, he said he spoke with Mr. Pascal again. “I very much wanted to buy it—the past two years I wanted to buy it,” Mr. Sullivan said. Eventually, though, the property went to the highest bidder, for a price “significantly more than I was willing to pay”—nearly four times its sale price 19 years earlier. Though he adds, “I can’t blame him for that—it’s just the way it goes.”

But continuing to lease the space is no longer an option: “Doing another long lease as a tenant doesn’t bode well for me, as I’ve learned the hard way.”

Ahead Of The Pack

Craft brewing has exploded as an industry, regionally, statewide and nationally. The Southampton Publick House was an early adopter: It is the oldest of the 18 craft breweries now found in Nassau and Suffolk counties.

It’s also one of the most award-winning small breweries in the country, holding several different honors, including being named top brewpub in 2003 by Beer Advocate Magazine. The Southampton Publick House brand had “significant momentum in brand building” in the early 2000s, Mr. Sullivan notes. He quickly began distributing all over Long Island and in New York City, and took the brand national in 2005, later signing a national deal with the Pabst Brewing Company. It’s a deal Mr. Sullivan pulled out of two years later, when Pabst was bought by a Greek food conglomerate.

But as an independent brewer, the Publick House has held its own: Small contract brewers upstate and in Pennsylvania brew about 6,000 barrels a year, the equivalent of about 80,000 cases of bottles, using the Publick House recipe, name and packaging. The beer is sold in 15 states in New England, the mid-Atlantic region and the Carolinas.

Mr. Sullivan says a solid product line of more than a dozen beers and a healthy relationship with wholesalers give the Publick House a competitive advantage in the industry—and plans for a new, larger brewery would allow him to both reduce costs and increase production of draft beers for commercial distribution. “The Southampton name alone gives us a certain caché that’s not to be underestimated,” he added.

So the plan is to stay put, more or less: The two properties he’s looking at are both within a mile or so of the village center, one within its boundaries, one just outside, and both are available for purchase. The properties, he said, are “visible locations” in “a more high-volume corridor”—clear indications that they are along or near County Road 39 or Montauk Highway. A restaurant of similar size is planned, but the brewing operation—currently limited, by the village, to providing only the beer sold on the premises—would grow significantly.

“Whatever other location we look to move to, expanding the brewing capacity on site is ultimately important,” he explained. “Because what we need to do is be less sensitive to, less reliant on, the restaurant foot traffic, because of the incredible peaks and valleys of the calendar on the East End of Long Island. We have to become less impacted by how many meals we can do on a Tuesday in January.”

He added, “There’s a ceiling. There’s only so many hamburgers, there’s only so many racks of ribs, there’s only so many pints of beer we can sell, 364 days a year, in this community.”

The Quiet Season

The move comes after years of turmoil. Mr. Sullivan said a variety of factors combined to make the business a challenging one to maintain: “I would wake up every night, saying, ‘I have no idea how we’re going to get out of this.’”

First, there was the general economic downturn that affected most local businesses. But changes in the restaurant business, including a localized evolution, all took a toll. “I’m not the only independent restaurant operator who is saying it’s getting harder and harder,” Mr. Sullivan said. “The area has seen an extreme increase in high-end dining, and seen an extreme decrease in casual dining.”

When the Publick House opened in 1996, he noted, he counted nine year-round restaurants in village. Today, he lists three, including his own. The year-round population in the village is declining, he said, and it becomes harder and harder to stay open year-round.

“The seasonality is inescapable. You’ve got four to five months that are very quiet. Southampton Village has, over the years, become less and less a destination for people in the evenings. This is a quiet village after 7 or 8 o’clock at night. It’s quiet. There’s no secondary activity, very few secondary activities—this is a 9-to-5, Monday-to-Friday village.”

Just weeks before the recession hit in 2008, the Publick House had a disaster of another kind: the death of Andrew Reister, who was working as security in August when he was choked to death by a patron. It was, Mr. Sullivan said, a “tragedy beyond understanding,” and added, “It was a very, very challenging time for us—financially, emotionally.”

There were other factors over the years: the closure of Southampton College, the austerity budgets at Southampton Hospital. “The only two large employers, the only two large institutions, in our five-mile radius, both effectively shut down or go on austerity—big loss,” Mr. Sullivan said. “That’s your bread and butter when it’s January, February, March, April. Those four months are very long.”

The winter of 2014-15 was, with the added factor of bad weather, “the worst winter in 19 years, simple as that”—down 15 percent from the previous year. “That’s the difference between making payroll and shutting down for a couple of weeks,” he said, which is something he rules out, because of its potential effect on staff and lack of continuity for customers, who expect to know the people they see at the Publick House, on both sides of the bar.

“When people walk in, there’s a sense of community in this place—people know each other, people have a comfort zone,” he said. “They know we’re open every day. I really abhor the idea of closing for a week or a month.”

By Definition

Don Sullivan has a master’s degree in hotel and restaurant business from New York University, and has served as a consultant in the restaurant industry during his years as the Publick House’s owner. “It’s fun—you can’t have more fun than I have every day,” he said of his trade. “Your worst day is a great day for most people.”

Despite the stresses, there is excitement as he looks into the near future at the “huge opportunity” that awaits. It’s “liberating,” he says, to be in control for the first time in a long time, rather than reacting to conditions beyond his control. “That’s a different mindset,” he said, “and we’re very excited about it.”

Within three to six months, he says, he will choose a new site. The transition likely will take anywhere from six to 18 months. In the meantime, he plans to keep the Publick House operating on Bowden Square, with the permission of the new owners. So a new Publick House operation could be up and running at a new site as early as the end of next year.

An expanded brewery would add 10 full-time, year-round jobs to the current operation, which is about 30 employees.

Brewing more draft beer in Southampton also will allow Mr. Sullivan to develop the brand, using the “flagship” location in Southampton as a destination, and a production facility. A longer-term plan would add “satellite facilities” throughout the metropolitan area: smaller Publick House taverns and tasting rooms, perhaps with small supplemental breweries.

Mr. Sullivan talks about wanting to stay in the village center. “It’s not that I don’t want to be here—I can’t afford to be here,” he said “That’s the truth … And that’s a shame.”

The central location on Bowden Square means a lot to him, as does his business’s status as a “locals” meeting place. “That’s the heart of what a Publick House is—it’s a place for community. That’s the Publick House, that’s by definition …

“There are very few places that you walk in and you can be sitting next to a local attorney, a local landscaper, a local plumber, a local newspaper reporter. Those places don’t exist anymore … It’s hard to find.”

‘A Perfect Site’

On the cusp of making the move, he has a Hail Mary proposal that he’s pitched to Southampton Village officials: Allow the Southampton Publick House to lease the former Parrish Art Museum building on Jobs Lane, a historic village-owned brick building that is currently the home of the Southampton Arts Center.

“I have, for a number of years now, quietly suggested to Village Hall: Can we talk about what I think is the perfect location for a working brewery and multi-use restaurant and entertainment facility? It would be that building,” he said. “That building just screams to me to be a perfect site for a working brewery and casual restaurant. You could create an entertainment hall in the large center gallery. The rear auditorium is perfect for the brewery. The logistics of the building are perfect.”

He continued: “If you look around the country, small cities, small towns, are falling all over themselves to take over factories or rustic-style buildings and to attract small breweries, small distilleries, small wineries into those type of places. Because they’re natural tourist attractions, they’re a working member of the community, they’re open every day, all year long, they provide jobs. They’re a solid business community member.”

A former member of the Parrish Art Museum board, at the time when the decision was made to relocate to Water Mill, Mr. Sullivan said he’s very familiar with the building and believes it would be perfect for what he proposes, down to the space for loading docks in the back and the parking, on Jobs Lane and in the municipal parking lot nearby. “What the village needs is a strong, visible, viable enterprise that’s going to be in this village to drive interest, drive activity, drive foot traffic,” he said. The other restaurants would feed off that, the other shops would feed off that.”

Southampton Village Mayor Mark Epley has heard the pitch, but he says there’s one significant catch. “The village has already leased the property to the Southampton Arts Center,” he said. “They’re gradually developing programming, and the numbers have grown every single year.”

He allowed that the Publick House “in the heart of the Village of Southampton—that would be a huge economic driver.” But he added that he worried about the legalities of using a public property for a private business, especially with the Arts Center’s early success. “I would have a hard time supporting going in a different direction, because I know what these people have accomplished in a relatively short period of time,” he said, adding, “If there’s an opportunity to keep him in the village? Great. But I don’t think this is a realistic location.”

Wherever the future site of the Southampton Publick House may be, Don Sullivan said it’s important to keep in mind that the business’s story isn’t ending, and possibly is just beginning.

“It’s a great story to tell—three brothers open a place in ’96, and we mature into something more. A lotta bumps and bruises, potholes along the way, but we persevered. I hope to be able to tell that story.”

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good article.
By Lets go mets (349), Southampton on Nov 26, 15 7:44 PM
He sounds a little too happy to be losing his location. Just doesn't sound right.
By dnice (2345), Hampton Bays on Nov 26, 15 11:31 PM
1 member liked this comment
Why wouldn't he be? The Bowden square location is starting to look dilapidated-- has been for the past 5 years. Plus the bad mojo from the Reister incident. Lotta great times and memories there but change is good. Extremely excited and looking forward to a refresh and a new Publick House for the new year. Congrats Sully!
By johnj (980), Westhampton on Nov 30, 15 10:50 AM
He doesn't sound happy to me. Just a nice guy trying to make the best out of a less-than-perfect situation.
I wish the Public House the very best!
By baywoman (162), southampton on Nov 27, 15 2:41 PM
1 member liked this comment
Sully has done a lot for the local community, glad he is committed to staying! The old Parrish would be the perfect location!
By bigfresh (4314), north sea on Nov 27, 15 4:50 PM
1 member liked this comment
Great article....please stay in the Village!!!!!
By rjhdad (73), southampton on Nov 27, 15 5:52 PM
One more reason to approve Tuckahoe Center development. A local business with plenty of room for growth looking for a location that would allow for expansion.
By Toma Noku (616), Southampton on Nov 27, 15 7:50 PM
WRONG! No need for a shopping center on CR 39.
By bigfresh (4314), north sea on Nov 28, 15 7:09 AM
2 members liked this comment
They -- the original brothers -- and then Don, have always been exemplary in their vision to offer a progressive yet traditional vibe in Southampton.
Good on them!
I've always wondered how much the sadness of the violent Bouncer/Patron issue cost the Sullivans. Not just in the perception of the space as one of sadness but gosh, what they must have paid out to the widow and family ...Something! I hope.
That said, since then they have struggled to keep the House a happy space.
Against ...more
By candyw (20), wainscott on Nov 28, 15 10:49 PM
In the late 90s the PH was the place to be and work as a college student. While turnover in the all the restaurants in the area was typical for seasonally dominated businesses, the PH was one place where it was nearly impossible to get a job. Once I was started working though as a runner and a barback it became apparent why this was the case. It was a great place to work. I enjoyed the kitchen crew, the barstaff and my fellow servers. I really like Don, his dedication to the PH, the long hours ...more
By FlorianKoch (1), on Nov 30, 15 4:08 AM
1 member liked this comment
Here Here Dr. Flo, you are truly missed!!!
By bigfresh (4314), north sea on Nov 30, 15 6:37 AM
OH no another newbie, outsider who wants to change everything about my hometown and 13 generations of working experience in this beautiful area.
The previous newbies, say 1890's, also wanted change which my ancestors fought, some successfully.
It seems to me this crop of newbies are ONLY interested in making their cash and moving on. Not really interested in what is right and good for the citizens.
I was there in 1952 when a caring resident of the 'Beach Club' folks Mrs. Littlejohn ...more
By summertime (589), summerfield fl on Nov 30, 15 10:36 AM
1 member liked this comment
Glennon Dealership? Sounds like the spot he'd want to be in. The Village would not all the publicity of allowing a for-profit brewery to take over Job's Lane.

Additionally, to say that the winter season is seeing less crowds is false. Just look at the traffic deep into the Holiday season. The issue is that the local "year-round" restaurants have nothing to offer for a young crowd that is diminishing. The Hamptons no longer entice young people to stay, nor can they afford to. Those that ...more
By Mouthampton (419), Southampton on Dec 1, 15 10:09 AM
1 member liked this comment
Treasure Inn?

By C Law (340), Water Mill on Dec 1, 15 10:19 AM
Haha. I've ben trying to think of the name of that place forever now. Can't believe it's still standing.
By johnj (980), Westhampton on Dec 1, 15 2:13 PM
If the termites ever stop holding hands that dump will come tumbling down!
By bigfresh (4314), north sea on Dec 1, 15 2:31 PM
1 member liked this comment
Maybe they could try serving consistently good food. That would go a long way.
By btdt (435), water mill on Dec 3, 15 1:11 AM
1 member liked this comment
Does anyone remember Herb McCarthy?
By Vikki K (490), Southampton on Dec 3, 15 2:51 PM
1 member liked this comment
I am a big fan of Southampton Publick House, their product, and their employees and know Don Sullivan to be a big supporter and contributor to our community. I look forward to taking my family to the new location and I also agree that the old library spot would be ideal for this type of business. Or maybe with some modifications the old post office spot!
By Killerfrog (34), Southampton on Dec 3, 15 6:15 PM
Publick House is an awesome spot especially on big horse racing days. Loved going there.
By islander6615 (133), hampton bays on Dec 6, 15 11:31 AM
Suffolk Designer Lighting, Tent Sale, Renovation Sample Sale