Knoxville Farmacy has faced challenges negotiating its lease, which prevents liquor sales and table service, leaving the West Knoxville business searching for a new home during an already difficult time for the restaurant industry.
Owner Bettina Hamblin is asking customers to share suggestions for a new building as she plans to continue month-to-month payments for the current space on South Northshore Drive.
“From the beginning, we’ve had so many awesome, loyal regulars,” she told Knox News. “They feel very connected to us. Farmacy belongs to them; we belong here. And so, it’s hard to imagine picking up and leaving this neighborhood, especially after COVID.”
Exclusivity clauses hold back growth
Hamblin has occupied the current building for the past eight years. It started as a space for her catering business and bakery before she turned it into a restaurant.
“When we opened the restaurant, we didn’t really know what to think,” she said. “But from the beginning it was just an overwhelming feeling that we were really well-received, and the community is super supportive of us.”
The space is small, but Hamblin made it work — even though an exclusivity clause for the shopping center keeps the Farmacy from selling alcohol, except beer, and requires the restaurant to be counter service.
Mark Shipe is the president of Holrob, which manages the current Farmacy property. He told Knox News the restrictions date back years.
These restrictions can be burdening for Hamblin. Champagne with brunch and wine with dinner are two great revenue streams for restaurants, she said.
But Shipe said the clause was clear when Hamblin first signed her lease.
‘I know both sides of it’
The lease ended in June, and Hamblin was hopeful these restrictions could be negotiated. Hamblin also hoped for a discount on rent — “just a little bit of a break” — but that wouldn’t be a deal breaker, she said.
Shipe said the discount Hamblin is asking for just isn’t possible. Landlords have mortgages to pay, he said, and those mortgages aren’t being discounted the way Hamblin would like her rent reduced.
Shipe said he wouldn’t expect Hamblin to reduce her menu prices, either.
“I know both sides of it,” he said. “I’m a tenant, and I’m a landlord. I understand how it works. I would love to keep her on. I think she’s great for the center.”
If that’s not possible, Shipe said, he’s willing to help her find space at another Holrob location. But prices in Hamblin’s desired areas, including Northshore and Bearden, likely won’t be cheaper, he said.
‘Unbelievable’ customer support
Hamblin made a Facebook post Aug. 26 explaining the situation to followers and asked for suggestions.
“We’ve been super transparent throughout this whole entire process, even from day one of coming up with the concept of the restaurant,” she said. “I was a little hesitant to post something like this.
“At the end of the day, I knew our customers needed to know we weren’t leaving them — it wasn’t our choice to leave.”
Hamblin said she hoped to get a handful of positive responses, but the reaction has been “unbelievable.” The post had 475 reactions, with more than 600 combined comments and shares as of noon Tuesday.
“I don’t have any angry feelings,” Hamblin said. “It’s all business. Everyone is trying to survive during this, and they’re going to do what they think is right for the shopping center. And we have to do what we feel is right for our brand.”
‘An opportunity for us to grow’
Hamblin said in the Facebook post she would like for an investor to come on board.
“For us, looking to grow — looking to kind of come full circle with our brand means trying to find some person or people who believe in what we’re trying to do and want to get involved with that,” she said.
If Hamblin has it her way, the restaurant will remain in the Northshore area. But she knows open restaurant space is limited.
She’s received some leads for spaces in Bearden and Farragut that could fit her priorities.
First, she needs a roughly 3,000-square-foot space already built for a restaurant. As more people express interest in sitting outdoors during the pandemic, she also wants a restaurant with patio space.
Even after the pandemic is over, Hamblin said, she’s not convinced people will go back to sitting shoulder to shoulder.
Hamblin would like to stay at the current location for another year to “get over the hump.” But given the circumstances, she said, maybe now is the best time to move.
“At the end of the day for us, we love our customers,” she said. “They’ve been super supportive of us. We think this could be an opportunity for us to grow and do some of these other things we haven’t been able to do.”
Anyone with suggestions for an open space can contact Hamblin at email@example.com.