Fuji Grill sales freeze during the offseason

The teriyaki and hamburgers at Fuji Grill at Corona del Mar State Beach could become the latest casualty of the bad economy.

Sales are sluggish at Fuji Grill, which took over concession duties for the city of Newport Beach at Big Corona last year.

The restaurant’s owner now says he wants to renegotiate his contract with the city to run the concession, or he could be forced to closed.

“I’d really like to stay because I don’t want to lose my reputation to my family for making the wrong decision when I made the contract,” said John Lee, who owns several Fuji Grill restaurants across Orange County.

Lee also owns the upscale Japanese eatery Fuji Yama at 4511 W. Coast Hwy., Newport Beach, which he said is doing well, despite the bad economy.

Lee was expecting year-round business at Big Corona when he took over concession duties there, but sales haven’t been as good as he had hoped, he said.

“On rainy days, I have no customers — my business is almost zero, but I have to keep staff there because I have a contract with the city,” Lee said.

Higher food costs and a weak U.S. dollar against the Japanese yen also have been bad for business — the restaurant imports some of its ingredients for sushi, Lee said.

Lee hopes the city will be understanding and renegotiate his contract.

“This last year has been really tough in part due to the economy,” said Newport Beach City Attorney David Hunt. “We’re trying to find a way to work this out quickly enough to get a new contract before this high season starts.”

Business was good last summer at the beach when the grill first opened, but sales have been chilly this winter, Lee said.

“The bad economy has created revenue lower than what we anticipated,” Lee said. “I’m still very happy about the concession and we have built a very good clientele, but the revenue is not enough to sustain our business.”

The city awarded a concession contract to Fuji Grill in January 2008 to serve teriyaki Bento bowls at Big Corona, but also more traditional beach fare, such as hamburgers and hot dogs.

Fuji Grill agreed to a five-year lease at Big Corona with two, five-year extensions, according to city documents. The restaurant also agreed to pay $80,000 or 15% of gross sales annually for the concession, whichever was greater, according to the documents.

The city awarded Fuji Grill the contract to sell food at the beach after tearing down the old concession stand and replacing it with a new 1,043-square-foot facility. The city couldn’t come to an agreement with the old concessionaire, Kilmer Enterprises, and the place sat empty in summer 2006.

Newport Beach considered leasing the concession stand to Rudy’s Pub and Grill, but the City Council ultimately rejected the idea because the restaurant wanted a liquor license, according to city documents.

BRIANNA BAILEY may be reached at (714) 966-4625 or at [email protected].