Kitchen owners claim they were misled by management; one property manager says it is the ‘cost of doing business’

By the time the Phoodery in downtown Phoenix marked a full year in business in early July, restaurant tenants and those who manage and own the popular downtown food pod were observing the venue’s one-year anniversary in drastically different ways.

Owners of the property pointed to redevelopment of a dilapidated part of downtown Phoenix and creation of a destination community gathering spot through a public-private partnership between the Phoenix Urban Renewal Agency and private developers.

Phoodery tenants, on the other hand, said monthly expenses had climbed four times higher than they signed on for, and one tenant claimed “gross mismanagement” of the property had soured their experience.

Three of five Phoodery tenants interviewed this week by the Rogue Valley Times — Wok Star, The Flying Flatbread and Ma’s BBQ — say they won’t renew their lease, which expires in April 2026, and are devising an exit plan. 

Further, Alec Hurdle and Ali Tarraf, owners of The Flying Flatbread, claim kitchen owners were misled on the details of their occupancy inside the highly popular complex along Phoenix’s main drag.

Public-private partnership

The Phoodery opened in July 2024 through a public-private partnership between PHURA, commercial real estate broker Eric Herron and contractor Kyle Taylor. The two partners, registered with the Oregon Secretary of State’s Office as Phoodery Phoenix LLC, modeled the venue after food truck court concepts they saw in Portland and Bend.

The development fulfilled a goal of the city’s urban renewal agency to redevelop a downtown area of ramshackle buildings and overgrown wetland areas between North Main Street and Bear Creek Drive. The partners reached an agreement for a $1 purchase of the property in exchange for their investment in the downtown core.

The Phoodery concept is an outdoor kitchen featuring a taphouse — run by Skout Taphouse & Provisions — and five distinct eateries. Skout Taphouse owners Tom and Lisa Beam, along with Herron and Taylor, are registered with the state as Phoodery LLC, which manages the property, while Herron and Taylor, as Phoodery Phoenix LLC, own the property.

The Beams have run Skout in Ashland since 2021 and own multiple other eateries, including the shuttered Yellow Basket in Central Point, which they plan to transform into a Skout location.

Prior to opening, Herron reported more than 30 applications from would-be tenants; the five selected for occupancy included Truffle Pig Craft Kitchen, Wok Star, The Flying Flatbread, Peruvian Point and Ma’s BBQ.

Kitchen tenants signed a two-year lease for their 24-by-10-foot space and set out to pay $2,000 rent per month — with a $100 increase during the second year — and an estimated $1,150 in common-area maintenance costs, known as “CAM fees.”

Tenants interviewed by the Times say details provided at the onset of the project were a far cry from what transpired. While most were paying a few hundred dollars rent in previous locations, the promise of being part of the community project was appealing.

“Basically, our monthly cost would be $3,150 with some slight fluctuation for CAM fees. Our first 12 months averaged $3,900 for CAM fees, instead of $1,150. And now, since April, it’s been like $4,700, even before our base rent, so almost $7,000 a month to be there,” Hurdle said. “We agreed to $3,150, which was already a big risk to begin with, but from day one, it’s been double, triple or more.”

During the first 12 months the Phoodery was open, between July 2024 and June 2025, CAM fees ranged between $2,631 in January and $5,003 in May, increasing the expected $13,800 annual cost, per kitchen, to more than $45,000 total, according to documents provided by Hurdle to the Times.

Hurdle also said details discussed prior to lease signing never came to fruition, and he said additional charges — for items such as picnic tables, a concrete cleaning machine and trash cans — were billed to tenants.

“They sold us on, ‘Just focus on your kitchen and let us worry about the rest,” Hurdle said. “Nobody would have signed up for what it ended up being.”

Tenants cry foul

Hurdle, along with Ma’s BBQ owner David Folmar and Wok Star owner Russell Evans, said they began paying $2,000 toward monthly CAM fees, higher than the projected $1,150 but lower than monthly invoices, they said, in an effort to show good faith. 

Folmar said the kitchens were all notified in recent weeks they would have to begin paying $3,900 per month towards CAM fees and “settle up” at the end of the year for any additional costs.

“When we first moved in, my wife couldn’t sleep, she was so nervous we weren’t gonna make it at the original $3,150 (total) each month,” Folmar said.

“The space is not much bigger than a food truck. For it to be as much as $7,000 a month. … My god, you could rent (Osteria) La Briccola, on the plaza in Ashland, for that. Instead, we’ve got a small kitchen and a walk-in that’s like six-by-six.”

Phoodery management says success prompted increased costs

Contacted Thursday by the Times, Herron, who declined to discuss lease information for specific businesses due to confidentiality, said CAM fees had fluctuated based on the Phoodery’s business volume.

“What we have seen is the volume of business we’ve done out there is three times what we projected, and three times what the restaurants projected,” Herron said, noting that restaurant expenses were “directly related to the amount of food being purchased” and that revenues for Phoodery kitchens were as much as ten-fold what restaurant owners reported prior to operating at the Phoodery.

Folmar said Herron’s claims are “factually incorrect” and that restaurant owners don’t disclose monthly revenue to Phoodery management. Hurdle, Folmar and Russell said monthly sales have not been significant enough to justify expenses billed and that off-season losses, due to lack of winterization, forced the three to take out loans to stay afloat.

Herron said winter improvements discussed, such as pull-down doors, had not been part of signed lease agreements.

Two remaining Phoodery tenants, Peruvian Point owned by Christian Ainzuain and Truffle Pig owned by Skyler Golden, declined to be interviewed by the Times. 

Lisa Beam, co-owner of Skout Taphouse and one of the property managers, said CAM fees had been driven by the Phoodery’s success and were not abnormal for the restaurant industry.

“We have set out to create a space that can host a lot of people of all ages and to bring a lot of different food offerings,” she said.

“And those offerings have been brought by food truck owners who had a lot of experience, and some that had none. It is not surprising to hear some individuals were caught off guard by the unexpected cost of doing business, but, from our standpoint, the customer volume has been in line with the overhead.”

Tenants had reservations

Evans of WokStar, who launched his food truck in 2012, said his list of frustrations was extensive, including what he claimed was misleading information from property management. Evans said being managed by fellow tenants — the Beams — would have impacted his decision to sign a lease.

“Everything has been, let’s just say, not as advertised,” Evans told the Times on Wednesday.

Evans claimed managers “misrepresented everything.”

“I thought it was already pretty expensive to begin with, but I never expected it would be up to four times as much,” he said.

Folmar said morale had taken a dive in recent months with management becoming “more aggressive.” He also claimed that management mocked kitchen owners for complaining about extra costs.

“They put a door on the walk-in, and the wind grabs it and smashes it into the wall, Tom (Beam) loves to joke, ‘Oh, it’s gonna cost you guys $7,000 for a new door!’” Folmar said.

“He thinks it’s funny, but it’s not (expletive) funny. This is our livelihood.”

Hurdle, who said he was threatened with eviction in July over unpaid CAM fees, said he filed a complaint with the Oregon Real Estate Agency and the Oregon Department of Justice, for misrepresentations and unprofessional conduct by Herron. Neither agency has jurisdiction over the issues raised, however, and Hurdle and other tenants said they were reviewing other options.

Phoenix Mayor Al Muelhoffer, who has helped lead the Phoenix Urban Renewal Agency for nine years, said he was unaware of any concerns related to the Phoodery and was unable to speak to “inner dealings.” The mayor touted the success of the property and said it had “changed Phoenix from a bedroom community to a destination.”

At the Phoodery on Wednesday, the three restaurant owners who spoke to the Times said they worried about how they would endure another offseason. Hurdle and Tarraf said they were disappointed at the trajectory things had taken.

“We love the Phoodery concept but don’t like how it is grossly mismanaged to become economically unviable for us,” Tarraf claimed.

Hurdle quipped that food truck owners considering future occupancy at the food pod “are gonna see $7,000 (per month) and faint.”

Folmar said he doesn’t expect resolution regarding CAM fees or other issues but decided to speak out in hopes of warning future tenants, claiming they would not get the full story from management.

“After they realized we weren’t renewing our leases, they told us, ‘Oh we got people calling every day to come here!’ But I’m sure none of those people have any idea what it’s going to cost,” Folmar said.

“And they’re not gonna tell them either.”

Reach reporter Buffy Pollock at 458-488-2029 or buffy.pollock@rv-times.com. Follow her on Twitter @orwritergal.