New Owners for Pearl's, Red Mesa, Cafe Sante

One of northern Michigan’s largest restaurant groups is under new ownership – a deal that could pave the way for future expansion in the market.

Fred Moore, Mary Palmer and Jim Cartwright signed a deal Monday to sell their ownership stake in Magnum Hospitality, a company that includes Pearl’s New Orleans Kitchen in Elk Rapids, Red Mesa Grill in Traverse City and Boyne City and Cafe Santé in Boyne City. An investment group led by long-time Michigan restaurateurs Mark and Barbara Wibel and Steve Rossi – who will head company operations – is set to take over.

After 18 years in the industry, Moore and his partners were “looking to simplify” their lives, he says, and either retire or move on to different careers. However, “when you have a business of this size, you don’t just turn in your resignation,” says Moore. “You have to come up with an exit strategy.”

The Wibels – who have a home in Harbor Springs and were long-time customers of Cafe Santé – have operated restaurants ranging from Carrabba’s Italian Grill to Tom + Chee and approached Moore previously “about expanding the Red Mesa Grill concept,” he says. While the idea fell through after the economy collapsed, the parties stayed in touch, with the concept of taking over all of Magnum arising earlier this year. When discussions began in earnest, the Wibels brought Rossi on board.

An Escanaba native who visited northern Michigan regularly for a decade while overseeing twelve Outback Steakhouse locations, Rossi describes himself as the “new steward” and face of Magnum Hospitality. Rossi, who recently sold his Ann Arbor home and relocated to Traverse City, says he is charged with preserving the restaurant group's “culture and success.”

“We think Fred and Jim and Mary have done an amazing job with these restaurants, and we don’t intend to change that,” says Rossi. The company’s 200-300 employees (which fluctuate seasonally) will remain in place, says Rossi, as will each restaurant’s menu, concept and décor. “We don’t want to change anything while we get in there and learn these businesses,” he adds. “It’s all about the people and culture. The last thing we would want to do is upset that.”

Long-term, however, “small tweaks” to the restaurants are possible – as is overall expansion. Several sources familiar with the company say discussions have included the possibility of eventually franchising Red Mesa Grill. While Rossi says it’s “too early in the game” to discuss specifics, he adds that “nothing is off the table” for the company.

“Whether it be acquisitions or the creation of new concepts or the replication of existing concepts – those are all on the table, and are all very exciting,” he says. “Northern lower Michigan has a lot of potential for the hospitality industry. Our goal is to take what (Magnum) has done and invigorate it…while also paying attention to what our customers are saying and how they’re evolving.”

After nearly two decades in northern Michigan’s restaurant scene, Moore says walking away from the company is a “bittersweet” moment for him. “These employees are my family…and it’s really hard to walk into a restaurant now and use the front door,” he says. But Moore also says he’s confident in the new ownership and excited for the potential opportunities the deal could provide for staff.

“I would be very excited to see (the company) grow and open new locations,” he says. “We didn’t have the energy to do it…but now there is that opportunity. When you have a 17-year-old concept, trying to keep the energy and excitement up can be challenging. So this is exciting. I expect very good things.”