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Real Estate Plays Major Role in Rick's Cabaret Operations

HOUSTON-A nightspot owner's life is definitely a "cabaret," with expansion plans becoming a prime attraction. The four-location Rick's Cabaret has just sealed a deal for an upscale club in Houston and has sights on a spot in Ft. Worth.

By Jack Burney | Updated on November 27, 2000

HOUSTON-Publicly traded Rick’s Cabaret International Inc. has acquired Chesapeake Bay Cabaret, an upscale gentlemen’s club located between the NASA Space Center and Houston’s Hobby Airport, but this time they had to lease the real estate instead of buy it.

“We own all the real estate that the company’s clubs are located on, except the new location, which we leased,” said Eric Langan, president and CEO. The deal for the new location had been completed once all licenses and permits had been issued, although Rick’s management has been operating the club since May, pending completion of the details.

The purchase price for the business calls for the issuance of 160,000 restricted shares of Rick’s common stock to WMF Investments Inc. and a 10-year lease agreement that grants Rick’s an additional 10-year option for the property and the building. Langan, president and CEO, said “we have been able to operate the new location at a profit during the latest fiscal quarter and anticipate continued earnings from this location. With the new location on Houston’s south side, we will have greater leverage of our advertising dollars.”

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