Scott Ball / Rivard Report
When City Council awarded Go Rio Cruises the multimillion contract to operate the City’s new fleet of river barges, the Landry’s footprint on the San Antonio River Walk expanded substantially. And that was just the beginning.
Although Go Rio is considered a locally owned company, one of its partners is Houston-based Landry’s, which already operates four River Walk eateries: Morton's The Steakhouse, Landry's Seafood House, Saltgrass Steak House, and the Rainforest Café. Landry's also owns the lease to manage and operate another nearby tourist destination, the City-owned Tower of the Americas and its Chart House restaurant.
Now Landry’s parent company, Fertitta Entertainment, has won a bidding war for the assets of the company that owns another River Walk restaurant, Joe’s Crab Shack, which filed for bankruptcy protection in June. There is speculation that it will become a Bubba Gump's restaurant, another Landry's brand.
While a consolidation of River Walk restaurant ownership may matter little to most locals who rarely visit the downtown tourist destination for lunch or dinner, other River Walk restaurant owners are concerned that Go Rio has yet to inform them of its plans for the long-held San Antonio tradition of river barge dining.
Fertitta Entertainment, a dining, hospitality, and gaming company based in Houston, ranks 126th on Forbes’ list of America’s Largest Private Companies, with $3.4 billion in annual revenues. The company is owned by Tilman Fertitta, 60, who is considered one of Texas’ wealthiest people.
With the 2006 installation of Saltgrass, the Landry company’s fourth restaurant on the river, former Mayor Phil Hardberger took notice of changes to the River Walk dining scene, changes he and others called "a very big concern."
When Saltgrass took over the space occupied by longtime River Walk establishments Justin’s Ice Cream Co., Hunan River Garden, and Italia Ristorante, Hardberger raised the issue with the Zoning Commission.
“I would like to have prohibited chain restaurants on the river,” Hardberger told the Rivard Report last week. “They cheapen the experience when you eat at a place that you could eat at in 100 other places. The Pearl, for instance, rules out any chains on their properties.
“After researching the issue, though, I felt the City would probably be unsuccessful in upholding such an ordinance, so we took no action. The Pearl can do it because they own the property.”
San Antonio River Walk Association Executive Director Maggie Thompson said though there are rules prohibiting gambling and strip clubs on the River Walk, there are no ordinances governing chain restaurants. There are currently 37 restaurants on the San Antonio River Walk.
“[Chain restaurants] are good for tourism because a lot of people visit from all around the world, and there are some who might be more comfortable dining at places they are familiar with, so I haven’t seen it become an overwhelming problem,” said Elizabeth Lyons Houston, director of marketing at Schilo’s and Casa Rio.
“There’s still a nice mix of local and chain, and to me, all the operators work really well together. But, of course, I will always advocate for local restaurants because I just think it offers the most authentic experience for a visitor.”
Houston is, however, concerned about the future of river barge dining. Casa Rio has been serving dinner aboard private cruises since the 1960s. Her great-grandfather developed river barge dining. But she’s been asked not to book any river barge catering contracts past October, when the new barge contract starts.
“It’s something locals enjoy doing on the river. It’s something our staff loves doing. It’s special and unique for our city and I would hate to see [Landry’s] start monopolizing that part of the river experience by utilizing all of their own catering services or restaurants,” she said. “It’s on the minds of everyone down here.”
Go Rio co-owner Lisa Wong told the Rivard Report that river barge dining will not change, with a few exceptions.
"We will have barges allocated specifically to dinner barges, where all the River Walk stakeholders up and down the river would have access to supplement any of their dining barge needs," she said.
Go Rio plans to make an online booking calendar available for consumers to help expedite the reservation process, she said. "So it's going to work very similar, but you'll know instantaneously the available time slots with a little more ease that will be greatly appreciated, and also help restaurateurs and hoteliers manage their time efficiently."
Wong, a local restaurateur, and VIA Metropolitan Transit Chair Hope Andrade own 51% of Go Rio. Andrade is also the former Texas secretary of state (2013-15) and owns several small businesses, including a political/business consulting firm. Go Rio was able to secure local preference points in the scoring matrix for the 10-year, more than $100 million contract that allowed it to receive more points than its main competitor, Chicago-based Entertainment Cruises. Another bidder for the contract, Buena Vista Barges, is challenging the legitimacy of those points.
Landry's representatives did not respond to several requests for information or interviews for this article.
"No one wanted to be on the River Walk then," Republic of Texas owner Rick Grinnan said. "It was a sewer trap. It was dangerous. It didn't take off until 1982 with [major hotels] opening."
Grinnan said it worries him that he can't book river barges for dining past October, and he's not sure he ever will again.
"It concerns me that the City is not handling this fairly. It just doesn’t pass the smell test," Grinnan said. "They never asked any of us to get on a boat and see if you can load food and liquor. It just got done. [The river barge contract was] supposed to be an open process, but if you dig into it, it wasn’t an open process."
City officials said Boudro's had been invited to host a dinner cruise on the prototype for the new river barge earlier this year.
"For 50 years, the restaurants and hotels have been doing boats," Grinnan said. "It's a horrible design. I’m not sure we’re going to do any boats. And we don’t know the price [for barge dining]. It seems like the [barge dining] value is gone. It would be nice for a family to come and for it to be affordable, but the cost to ride a boat is crazy."
Go Rio has plans to deploy some of the 43 barges for unique programming, working with local chefs in town to offer foodie experiences and wine tastings, Wong said.
Go Rio takes over Oct. 1 using some of the new, City-owned fleet of barges. The rest of the new barges are scheduled to arrive in November, according to city officials.
"We are very excited," Wong said. "The [barges] are absolutely beautiful and will be a huge complement to our River Walk experience. The City did an outstanding job designing them."
In April 2016, Houston-based Metalab's design won the City's International River Barge Design Competition, aimed at replacing the decades-old design that had been in place since Hemisfair '68. The prototype was unveiled in September 2016.
Amid the uncertainty involved in changing river barge operators, rumors have circulated about the fate of other River Walk eateries and bars.
“I don't have a clue on what Landry's' intentions are, but I can assure you that they will not be purchasing any of Paesanos Restaurant Group's current concepts,” said Steven Bartlett, the restaurant group's director of operations. “There is no merit to this rumor" that Paesanos may be sold.
The longtime River Walk bar Dick’s Last Resort – known as “the joint your mom warned you about” – will move from its current location, but "remain downtown," according to a manager who referred us to the general manager, who didn't respond to calls. Rumors about the watering hole's fate began circulating after the chain that owns it abruptly closed several locations across the country late last year.
Carrie Carillo, a manager at The County Line, said the barbecue restaurant has no plans to move.
Grinnan said chain restaurants have an advantage over locally owned establishments because they are better able to absorb rising rents.
"[Chain restaurants] have the wherewithal to spend a lot of money, and they are buying up the place," Grinnan said. "I don’t like it because you can go to those anywhere. The River Walk has a lot of family-owned restaurants that are going away."
This story was originally published on Aug. 15, 2017.