Earlier this summer, two businesses on 4th Street’s iconic Retro Row were forced to close their doors, sparking community controversy.
Portfolio Coffeehouse and Scholb Premium Ales Long Beach were adjacent tenants for just three years before posting their closing dates and a final farewell to their customers via Instagram.
Portfolio Coffeehouse, a local staple, has operated at the corner of Fourth and Junipero since 1990. For many residents, the coffeehouse has served as a daily pick-me-up, hangout and community hub.
“I’ve been going to this cafe since I was 19; I’m 48 now,” said Songbird Boutique owner and 4th Street board member Jennifer Hill. “I moved to San Francisco for about 10 years, and yet when I came back to visit, I always got a coffee at Portfolio.”
Sarah Sanchez, a current employee at The Hangout, shared similar sentiments about Portfolio.
“It was the first cafe I discovered when I moved here six years ago, and it still is [would] go, she said.
Fortunately, Portfolio had the funds to move their business just down the street, at 4th and Cherry, from their original location. The new space is currently under construction and will combine their two businesses, Portfolio Coffeehouse and Berlin Bistro.
However, the new kid on the block, Scholb Premium Ales Long Beach, couldn’t shoulder the same financial burden. The business was open in Long Beach for three years before closing. Good food, good drinks and a welcoming atmosphere had gained popularity among the local community. Many felt the impact of their closure along with Portfolio.
“It’s been a great addition to the neighborhood,” said a Long Beach local who preferred to remain anonymous. “My friends and I used to go get beer and enjoy happy hour like once a week. Many of the people who worked there were my friends.
Christian Valverde, a Long Beach State student and 4th Street resident, said he was devastated by the news of Scholb’s closing.
“It was a great place to relax, eat and watch a game; everything I had there was delicious,” he added. “I am truly disgusted to see him.”
With the positive support from the community, many questioned the closure of the two businesses. But Scholb Premium Ales made it clear the sudden shutdowns were not for lack of business.
In their Instagram farewell, Scholb addressed Portfolio’s past legal battle with their mutual landlord, Michael Salemi, over disputes over rising rents, contractual obligations and a cease and desist letter. Scholb also stated that their own problems with Salemi were “insurmountable”.
JMS Development’s Salemi explained that the litigation between him and portfolio owner Kerstin Kansteiner was unwanted but necessary.
“She was a great tenant,” he said. “I had a great relationship with her for many, many years and things just got worse.”
However, the relationship between Salemi and Jason Kolb, owner and head brewer of Scholb Premium Ales, was compromised by the closure.
Scholb Premium Ales leased the restaurant space from a previous business owner who had a master lease with Michael Salemi. Salemi explained that the owner of the master lease originally proposed a Japanese noodle restaurant for the location, but that ultimately fell through. When he was presented with the idea of Scholb Premium Ales, he admits he wasn’t immediately on board.
“I said no, I don’t want a brasserie on the corner,” Salemi said. “I said, you know it is, not me.”
Eventually, Scholb Premium Ales took over and the business relationship between Salemi and Kolb was positive.
“We [Scholb] they looked pretty good,” Kolb said. “Our chef, Jason, would come out with new dishes, we’d have beer nights…we had a group of ukulele players come out every Fourth Friday…all kinds of fun.”
But in 2020, the building’s previous owner’s primary lease expires. An extension application was therefore necessary in order for Scholb to retain his sublease.
Kolb claims that a request for an extension was made within the mandatory term by the owner of the master lease through an informal conversation with Salemi as well as via email. However, no written acknowledgment of receipt or approval of the request was given to either party.
In June, Kolb received news from Salemi that the lease extension had not been granted. Both parties claim to have various documents that prove or disprove the validity of the lease extension.
At this point, Kolb asked Salemi if there was anything they could do to stay.
“We talked to him really honestly, like hey, what are we doing wrong? What should we do better? Do you want more money?” Kolb said. “He just wanted us out.”
Salemi said he “just wants to develop the property.”
Before documents were exchanged from the master lease owner, Salemi claims he apologized to Kolb when he believed he himself had made a mistake about the lease.
“I said, oh my gosh, well, maybe I’m old and I just didn’t know that. Could you send me the copies?” Salemi said.
The landlord claims that the documents received are invalid.
“He was very upset, but it wasn’t about me,” Salemi said.
The truth about the dispute continues to be hearsay. However, it has caused a rift among the community, with some disappointed by the closure and others excited about what’s to come.
“I hate it, I miss them so much,” Jennifer Hill said of Portfolio Coffeehouse. “What will be there? How will they survive when the landlord doesn’t play by their rules? Will it be leased to a large corporation?’
Hill also expressed concern about the lack of foot traffic since the closure, which has negatively affected her business.
“It just creates a whole new atmosphere down here,” she said. “Now I kind of feel like I’m out when I always had an anchor by my side because it was a real cornerstone for the community.”
Two residents of “Retro Row” for 25 years and neighbors of Salemi, who preferred to remain anonymous, said the situation is frustrating and not what 4th Street is all about.
“Fortunately, she [Kerstin Kansteiner] is a very wealthy member of the community and had the resources [to move]but for someone like Scholb, it’s just not fair to give him no option and get very little notice,” said one local resident.
Others in the community believe the closure could bring positive change and a new dynamic to the street.
Dee Hayes, an employee at La Bomba Thrift, believes the Portfolio move may be necessary for the growth of their business.
“There are a lot of things that can be positive about it. They kind of outgrew their space. Now that they have a new setup, maybe they can have a travel window or more parking,” she said. “The owner has a lot of good ideas, I don’t see why he can’t make them ten times better.”
Kevin Alcaraz, co-owner of Plantiitas, said Portfolio will be missed but wished them the best.
“If they’re doing something bigger on this side as well, that’s good and exciting,” Alcaraz said. “Still sucks for the brewery.”
As for the future of the locations, Salemi said he wants to create a “gourmet corner.”
He said he wants restaurants that are diverse for the area and add an upscale feel. Some of the options I mentioned are Mediterranean, Italian, or a pizza place.
“I’ve already had five offers that have been rejected,” he said. “I’m very picky.”