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Granite City Food & Brewery Enters Into Long-Term Development Agreement with United Properties
Agreement Allows for 22 Stores through 2012
MINNEAPOLIS--(Business Wire)--
Granite City Food & Brewery Ltd. (Nasdaq: GCFB) a Modern American
upscale casual restaurant chain, today announced the signing of a
long-term development agreement with United Properties, a nationally
recognized real estate investment and development company. United
Properties, based in Minneapolis, Minnesota, offers development
expertise in office, industrial, retail, medical, residential and
mixed-use projects and currently has 17 projects totaling almost 3
million sq. ft.. under development in Minneapolis, Milwaukee, Wis. and
Denver, Colo.
Highlights of the Agreement:
-- 22 new restaurants to be built in 2009 - 2012
-- United will act as our developer for these 22 stores and have
the first option to develop anything above this minimum amount
through 2012.
-- United will be responsible for all costs related to the land
and building.
-- GCFB will have the right of first offer to purchase stores
owned by United.
-- The annual lease rate on all land and buildings developed by
United will reduce GCFB's current lease rate by 100 basis
points on fee simple transactions.
-- United will periodically sell buildings developed for GCFB and
will share a portion of the profits with GCFB
John Breitinger, vice president - Retail Development, United
Properties said, "We are excited to partner with Granite City. We
really admire their operations. We will help them accelerate the
growth of their business by bringing our development and site
selection expertise, capital and our construction experience."
Steve Wagenheim, CEO and President of Granite City commented, "Our
development agreement with United Properties enables Granite City to
properly plan and manage our long-term real-estate needs and a
balanced development cycle. We are pleased to have a Company such as
United Properties realize the national potential of the Granite City
concept. We look forward to the relationship and the benefits this
brings to our Company."
He added, "Those benefits include a strong foreseeable pipeline of
sites and the flexibility in site selection, with a team approach to
all areas of our business. It further increases our ability to lower
our overall cost of capital, as well as reducing our building costs by
eliminating middleman pricing when raw goods and FFE are ordered for
each store individually. Finally, I would be remiss in not thanking
Don Dunham and the Dunham Corporation for serving as our primary
developer during the early stages of our lifecycle."
About Granite City
Granite City Food & Brewery Ltd. is a Modern American upscale
casual restaurant chain that operates 25 restaurants in twelve (12)
states. The menu features affordable yet high-quality, family favorite
menu items prepared from made-from-scratch recipes and served in
generous portions. The sophisticated yet unpretentious restaurants,
proprietary food and beverage products, attractive price points and
high-service standards combine for a great dining experience. Granite
City opened its first restaurant in St. Cloud, Minnesota in 1999.
About United Properties
United Properties, based in Minneapolis, Minnesota, specializes in
commercial real estate development and investment. Since 1975, United
Properties has provided development services for the retail,
residential, office, medical and industrial sectors. The company's
residential development focuses on Applewood Pointe senior cooperative
housing. In addition to a large presence in the Minneapolis-St. Paul
market, United Properties expanded to Colorado through the opening of
a retail development office and the acquisition of Ojala and Company.
Formed in 1916, its investments group acquires, manages, finances,
analyzes and disposes of United Properties' real estate investments,
which includes more than 60 office, industrial and retail properties.
(www.uproperties.com). United Properties was founded in 1916 by the
Hamm family and now is owned by the Pohlad family, private investors
based in the Twin Cities.
Aethlon Capital
Aethlon Capital, which has worked with Granite City since 2002 was
responsible for brokering the deal between Granite City and United
Properties. Aethlon Capital, www.aethlon.com. is a private investment
bank that specializes in private equity and debt financings, mergers
and acquisitions and strategic advisory services for public and
private companies.
Forward-Looking Statements
Certain statements made in this press release of a non-historical
nature constitute "forward-looking Statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward
looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those
anticipated. Such factors include, but are not limited to, changes in
economic conditions, changes in consumer preferences or discretionary
consumer spending, a significant change in the performance of any
existing restaurants, the ability to obtain financing for, and
complete construction of, additional restaurants at acceptable costs,
and the risks and uncertainties described in our Annual Report on Form
10-K filed with the Securities and Exchange Commission on March
10,2008.
Granite City Food & Brewery Ltd.
Steven J. Wagenheim, 952-215-0678
President and Chief Executive Officer
or
James G. Gilbertson, 952-215-0676
Chief Financial Officer
Copyright Business Wire 2008
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