In late 2019, the owners of Mosaic Catering + Events began their due diligence on Cutshaw Ave. 3013 near West Broad Street.
Their plan was to convert the 9,500-square-foot Art Deco-style warehouse into a roofed event space so Mosaic could finally host its own events. The company, which also operates an eponymous restaurant at the River Road Shopping Center, has only catered events at other locations since its inception in 1996.
In late 2020, Mosaic purchased the building for $2.1 million, giving it control of that building and its corporate headquarters across the street at 3001 Cutshaw Ave.
Steven Niketas, who co-owns Mosaic with Laurette Garlitz and Mike Holland, said the bids they originally received for the building’s renovation were just under $1 million. After Niketas withheld any construction, Niketas said they are quoted like this almost three times nowadays.
“And it’s the same plans, man. It’s the same (project),” he said.
These increased construction costs have caused the group to reconsider their plans. Earlier this month, Mosaic put the building back on the market for an undisclosed amount. Thalhimer’s Connie Jordan Nielsen has the list.
Niketas said the prospect of doing the same project for three times the originally projected cost made them feel they needed to at least see what kind of interest the building would receive.
“I hate to say it, but eventually (the development of the venue) could be more than we want to do at our age. Two years ago I wasn’t that gun shy, I was willing to do almost anything to grow the business. But I think just like everyone else, I’m not sure if I have the stamina that I’ve had after the last two years,” Niketas said.
“What is the real cost of trying to expand? Do I really need another location?” he said. “I’m sure a lot of people are having the same conversations, not just the catering business.”
The building sits on a quarter of an acre and was last valued by the city at $1.8 million. Prior to Mosaic’s acquisition, the building was owned by Stony Point Design/Build, a Charlottesville development firm that intended to increase the residential density on the site.
Niketas said his group is determined to sell the building and Mosaic is willing to step out of his comfort zone to pull off a project on the site. During its 26-year tenure, Niketas said Mosaic has never had outside capital, management or business partners of any kind, but now they are open to the idea of collaborating with an outside firm on the Cutshaw project.
“At this point I’m literally open to all conversations with anyone because of the way things have been going over the past few years because it’s going to take a lot of creativity for people to grow their business effectively. It’s just gotten so crazy, you have to be open to more things,” Niketas said.
“Just because I don’t want to build a home doesn’t mean I can’t partner with an equity guy who wants a piece of prime real estate in a trendy part of town,” he said.
Niketas is now based in Charleston, South Carolina, where he oversees a location of restaurant group Giavos’ Stella’s concept. He said the heat of the Richmond real estate market was demonstrated to him by the recent sale of 5609 Patterson Ave., a 7,900-square-foot retail and office building he co-owned with Mary Kathryn Perkinson of MAK Financial Group.
The Near West End building sold for $2.8 million last month, nearly double its last estimated $1.5 million.
“That was a big deal. It was a big lightbulb,” Niketas said. “I never thought in a million years that Patterson would act the way it did.”
The new owner of the Patterson Building is Stony Point Wealth Management, a local firm unaffiliated with the Charlottesville development firm that previously owned the Cutshaw property.
This year, Niketas said, Mosaic has been inundated with catering requests and the restaurant is busier than ever. However, they had trouble filling in their staff.
This issue also contributed to their fears of taking on the Cutshaw project: without more staff, Niketas said, hosting events at the new venue would require them to withdraw from off-site events and the associated revenue.
“The replacement sale is the most dangerous part of developing the new venue. We don’t want to replace X number of off-site sales with X number of on-site sales,” Niketas said.
“It has to be new money, it has to be new sales. Otherwise I’m $3 million in development (cost) and in the same place. It was a really tough box to get out of,” he said.
As Mosaic weighs its options, many of the adjacent buildings will be demolished. Local developer Steve Leibovic is preparing to demolish almost all of the buildings on the block bounded by Cutshaw Avenue, Wayne, Sheppard and Grace streets to make way for a mixed-use project.