Franchise Pops Up in Germantown

By Andy Ashby
– Memphis Business Journal –

Mellow Mushroom, a fast casual pizza chain featuring an impressive beer selection, is sprouting up in the Memphis market, with an initial Germantown location and up to three more planned in the next five years.

Cary Fairless and Lori Fairless, operating as Jadon Enterprises LLC, signed a long-term, 5,000-square-foot lease at the Shops of Forest Hill, occupying the 17,000-square-foot former Old Navy space at 3075 Village Shops Drive.

The average quoted rate for Germantown shopping center space is $17.90 per square foot, according to CoStar Group, Inc.’s year-end report for 2008.

The couple discovered the concept while going to youth soccer tournaments with their children.“I thought this would really be good in Memphis because we didn’t really have anything like that,” Cary Fairless says.

Last summer, they started researching the concept and met with the franchisor, Home Grown Industries of Georgia.

“We’ve never done a restaurant, so it was good to know they knew what they were doing,” he says. “That’s why you get a franchise, to get that expertise.”

They are planning a 150-seat restaurant with patio to be open by October. They anticipate a start-up costs in the $900,000 to $1.3 million range. The restaurant, which will employ 15-20 people, will include a full-time manager with restaurant experience.

“We want to get one open and get it going correctly to ensure the quality is there,” Cary Fairless says. “We’ll look to expand from there.”

Charlotte, N.C.-based architecture firm Little is designing the space, working with Mellow Mushroom’s corporate art group. The restaurants feature common themes, but each location is unique.

“It’s kind of funky,” Cary Fairless says. “It started out as kind of a hippie-type restaurant, but it’s evolved. It’s a comfortable, but classy, place to go.”

The restaurant will serve pizzas, calzones, hoagies and salads. It will have 20 beers on tap, including specialty microbrewed beers.

Cathy Anderson, affiliate broker at Crye-Leike Commercial, represented Jadon Enterprises in the transaction.

“Mellow Mushroom’s corporate people came down and looked at this site months ago,” Anderson says. “We showed them many sites, but this was really the first choice.”

The Shops of Forest Hill is a 365,000-square-foot shopping center located at Poplar and Forest-Hill Irene.

It is anchored by Target Corp., Schnuck’s, Marshalls and Malco Theaters, Inc.’s Forest Hill Cinema 8.

Boyle Investment Co. assistant vice president Bradley Wilford and senior vice president Carey Whitehead represented the landlord, BIC-MTS Partners.

Mellow Mushroom has more than 80 locations nationwide, mostly in the Southeast.

Wilford and Whitehead have visited Mellow Mushroom locations across the country and say that each location is geared to a different crowd.

“They match the area, they draw on what’s already popular there,” Wilford says. “Some are more college-oriented and others are more family-oriented.”

Wilford says this location will benefit from its proximity to Mike Rose Soccer Complex.

“We think it ties in well with youth sports and Germantown is very youth sports-oriented,” he says.

Retail leasing started slowly this year, Wilford says.

“I’ve noticed in the past month that there has been a lot more activity just with showings we’ve had,” he says. “I’ve been very busy showing property and that’s all over, in Memphis, Germantown and Collierville. It’s not just people looking, it’s people looking to do deals.”