
DATE: Thursday, August 28, 1997             TAG: 9708280552

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER 

DATELINE: NORFOLK                           LENGTH:   78 lines

PHILLIPS MAY LEAVE WATERSIDE BUT A SPOKESWOMAN FOR THE RESTAURANT SAID THE BUSINESS' FUTURE AT THE SITE DEPENDS ON TALKS WITH MALL OFFICIALS.

Phillips Waterside restaurant, which helped draw large crowds to Waterside Festival Marketplace in the roaring '80s, may leave the downtown mall within the next nine months.

Celebrating its first anniversary at Waterside, Phillips boasted that it had reaped $6.7 million in revenues - more than any other restaurant in Virginia. Its diners ate 49,970 pounds of crabmeat and 95,005 pounds of shrimp during its first 12 months.

But the restaurant's glory days are over, according to Harvey Lindsay, a Norfolk real estate official who helps lease the festival marketplace. Lindsay believes the restaurant's possible departure reflects both the mall's recent struggles to draw shoppers and the restaurant owners' changing priorities.

The Phillips family now tends a small seafood empire that stretches from Washington, D.C., to Indonesia, and includes nine restaurants and five crab-packing plants. The family also operates two hotels in Ocean City, Md., where they live.

``I don't blame it all on them,'' said Lindsay, who helped sign on Phillips. ``It just didn't work out.''

The restaurant's lease expires in May 1998. The Phillipses have indicated they may depart before that date if a replacement tenant can be found, marketplace manager Vann Massey said.

Massey said several businesses have expressed interest in Phillips' 12,000-square-foot space, which includes a raw seafood bar, a fast-food outlet and an approximately 450-seat restaurant with a patio overlooking the Elizabeth River.

Steve Phillips, who helps manage his family's restaurant and crab-packing businesses, could not be reached. But a spokeswoman said the company has no immediate plans to close.

``We are interested in continuing our discussions with the Waterside mall people,'' said Honey Konicoff, a marketing director at Phillips Flagship restaurant in Washington, D.C. ``At the moment, we're here to May. And after May, it really depends on our discussions.''

The Phillips restaurant tradition dates back to 1956, when Shirley and Brice Phillips opened a carry-out seafood shop in a tar-paper shack in Ocean City, Md., according to newspaper reports and the company's online literature.

By the early '80s, the family had three restaurants in Ocean City and one in Baltimore's Harborplace festival marketplace. Sons Steve and Jeff help run the family operation.

Developer James W. Rouse, impressed with Phillips' success in Baltimore, urged the family to open a restaurant at Waterside in 1983, when the mall debuted.

But Lindsay, who helped seal that deal, said he has been disappointed with the restaurant's performance in recent years. He said customers have complained about inconsistent service and prices too high for the quality of food.

Phillips spokeswoman Konicoff acknowledged that the crowds have thinned. But she said the owners have not neglected the Norfolk restaurant in any way.

``I don't believe the quality of our restaurant has gone down,'' she said. ``I'm sorry they feel that way.''

Mall manager Massey said he's looking for a change - whether it's from Phillips or a new tenant. He said this fits with the mall's attempts to remake itself. Recently, the mall has made repairs and has beefed up its efforts to attract tenants.

``In any scenario, there would be substantial changes to (Phillips') space, simply because it's been that way for 15 years,'' Massey said. ``It's time to revitalize that area.'' ILLUSTRATION: Color photo

MARTIN SMITH-RODDEN/The Virginian-Pilot

Owners of Phillips Waterside restaurant, which has enjoyed success

at the Waterside Festival Marketplace, may be considering leaving

the site within nine months. The restaurant's lease expires in May

1998.

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[For complete graphic, please see microfilm]