The doors to McMahon’s Prime Steakhouse will not be closing any time soon, its owner vows.
Although his lender has moved forward with plans for a foreclosure auction on the collection of buildings that includes the popular restaurant, owner Bob McMahon said he plans to bring in new investors.
The McMahon-owned eight-building complex at North Swan and East Fort Lowell roads was foreclosed by Alliance Bank of Arizona. They include McMahon’s Prime Steakhouse and the offices of Metro Restaurants, which manages McMahon’s restaurant properties in the Tucson and Green Valley areas.
County documents list the principal amount McMahon owes on the 5-acre parcel as $6 million, but McMahon says he owes the bank about $5.2 million.
His company, McMahon Properties LLC, has also stopped paying taxes on the eight properties, owing more than $313,000 in back taxes, according to records with the Pima County Treasurer’s Office.
On Tuesday, McMahon said with the trustee’s sale not scheduled until Jan. 9, he has several weeks to find new investors by the end of the year.
McMahon said the property is currently being reappraised, noting the land was once valued at $13 million.
McMahon said the foreclosure will have no impact on the steakhouse, Metro Grill, Old Pueblo Grille or his other restaurants. He said he intends to keep the doors open on all of his businesses.
McMahon’s Prime Steakhouse and several commercial tenants in an adjacent plaza are not associated with the foreclosure, simply renting the property from McMahon Properties LLC.
Partner Ray Flores, whose family also owns four El Charro Cafés, did not return a request for comment on the trustee sale.
Flores and McMahon joined forces in 2009 to share operational duties like bookkeeping and payroll, but their restaurants remain independent.
McMahon has scaled back the size of Metro Restaurants over the last few years, closing several high-profile restaurants.
In the early 2000s, McMahon was running nine restaurants.
Closed restaurants include:
— Asian fusion restaurant Firecracker, 2990 N. Swan Road, which closed December 2007 after 10 years to make way for a joint French bistro venture with noted chef Philippe Trosch. Bistro Philippe opened in February 2008 and closed in June 2008.
— Metro Grill at Park Place, summer 2007.
— City Grill, 6464 E. Tanque Verde Road, summer 2007. Italia took its place in May 2008. It closed July 19, 2009, to make room for Nimbus Bistro and Brewery, a joint venture with McMahon and Nimbus Brewery owner James Counts. The partnership died less than a year later, with McMahon essentially becoming the landlord to the new owners.
— Old Pueblo Grille in the Foothills Mall, December 2008. McMahon cited competition from other mall restaurants, including newcomers World Sports Grille by Sega, which opened in summer 2008, and Sushi Garden, which opened January 2009.
A partnership headed by McMahon and Green Valley developer David Williamson took over management of two Green Valley golf courses, San Ignacio Golf Club and Canoa Hills, late last year.
Metro operates two restaurants at the golf courses, The Grill at San Ignacio and Grill on the Green at Canoa Ranch.