BY KIRK STARRATT

kstarratt@kentvilleadvertiser.ca

NovaNewsNow.com

Members of the general public have an opportunity to invest in a new Paddy’s Pub and Rosie’s Restaurant location in New Minas through a Community Economic Development Investment Fund (CEDIF).

Evangeline Investments Fund (EIF) is now offering the sale of its shares to the public to raise capital for investment in the soon-to-be established New Minas location. EIF is a Community Economic Development Corporation registered with the provincial Department of Finance. There will be annual general meetings of EIF to elect a board of directors and president.

EIF President and Paddy’s and Rosie’s General Manager John FitzGerald said, for every share, costing $3,333.33 each, investors would receive a $1,000 non-refundable provincial income tax credit if the investment is held for five years; a planned $100 yearly dividend, depending on financial results and subject to the approval of the board of directors; and a planned $3,333.33 capital repayment after five years. The share offering closes Feb. 29, 2008 unless the offering is granted an extension.

EIF will lend the capital raised to Paddy’s and Rosie’s and they will use the loan to transform the former Tradesman Restaurant location in New Minas into a new Paddy’s and Rosie’s location. FitzGerald said, if possible, they would fund the project 100 per cent through the share offering, although there are contingency plans in place.

Structure there to encourage local investment

During a public meeting in the Celtic Hall at the Kentville location Saturday afternoon, Feb. 16, FitzGerald said they started selling the shares in mid-December and had sold about 20 so far. He said at least 30 have to be sold because, due to the level of management involved, the initiative wouldn’t be worth it otherwise. They need 25 distinct individuals to invest. There were a dozen distinct investors as of the public meeting Feb. 16.

“This structure was created by the provincial government to get local people investing in local companies,” FitzGerald said.

The shares could be registered as Retirement Savings Plan (RSP) investments to realize additional tax benefits. Whether or not the offering is successful, FitzGerald said a $100 gift card for Paddy’s and Rosie’s would be included with every share purchased. He said he has a share in his name and plans to buy more.

FitzGerald said the Tradesman did about $700,000 in sales annually and that would be around the break-even point for their business plan.

“New Minas is a busy community and it will become busier,” he said, pointing out that the village is the commercial centre of the Valley.

FitzGerald said the location is close to a proposed highway access road the Department of Transportation plans to construct at Granite Drive once Highway 101 is twinned and is close to the site of big-box development likely to unfold on the Millett land later this year.

Artisan bakery onsite

Unlike the other Paddy’s and Rosie’s locations, there are plans to include a sort of artisan bakery with a retail component, something not overly common in this region. The staff from the current restaurants would work at the new location and help train new employees, and meals would range in price from $6 to $26.

They hope to have a broad-appeal menu, including several choices for breakfast and lunch. FitzGerald points out that, around here, you can’t be too niche in your approach.

He said upscale, high-end restaurants are doing well as more and more people are eating out of the home.

Last year was one of the most profitable ever for Paddy’s and Rosie’s, which is owned by his father, Brian FitzGerald. Paddy’s and Rosie’s acquired the New Minas location in 2005, but plans were put on hold following a fire at the Wolfville location in January 2006. The Wolfville location had to be gutted entirely and reconstructed.

A Wolfville law firm will hold investors’ funds in trust until the offering closes. If the conditions of the offering are not met, the law firm will return the funds to investors.

He said the Port Bistro in Port Williams raised capital through a similar initiative, but they originally got the idea for a CEDIF from Just Us! Coffee.

For more information, contact FitzGerald at info@evangelinefund.ca or (902) 679-0057.

The Paddy’s and Rosie’s story

The first Paddy’s Pub location opened in Kentville in 1992 and had $345,000 in sales the first year. A microbrewery was added in 1995, only the second to open in the Maritimes. In 1996, the Rosie’s location next door to Paddy’s in Kentville was acquired. It was the first all non-smoking restaurant opened in the province.

Paddy’s and Rosie’s had $1.3 million in sales in 1998 and were out of the red that year. The Wolfville location was acquired in 2000. It was the first all non-smoking pub and restaurant in the province.

The microbrewery was moved to Wolfville in 2001. Sales exceeded $3 million in 2002 and there were 70 people employed.

The former Tradesman in New Minas was acquired in 2005. There was a major fire at the Wolfville location in January 2006 and the restaurant and pub had to be gutted. This setback put the establishment of the New Minas location on hold.

Paddy’s and Rosie’s had $3.8 million in sales in 2007 and projects $4.1 million in sales in 2008. They plan to open the New Minas location this year.