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INSIDE DISH: St. Elmo stakes out expansion plan

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Inside Dish

Welcome back to IBJ’s video feature “Inside Dish: The Business of Running Restaurants.”

Our subject this week hardly needs an introduction. A local institution and likely the best-known Indianapolis restaurant nationwide, St. Elmo Steak House has been serving grill-seared steaks and scorching-hot shrimp cocktails to downtown patrons since 1902.



“We see St. Elmo’s as Indianapolis’ restaurant; we’re just stewards of it for a period of time,” said Craig Huse, managing partner and co-owner with his father, Stephen Huse. “We feel a lot of weight and responsibility with maintaining and improving the reputation of this restaurant.”

Founded by Joe Stahr in the Braden building at 127 S. Illinois St., the eatery originally known as Joe Stahr’s Tavern operated at street level and entirely in what now is considered St. Elmo’s barroom. A series of renovations and expansions beginning in the 1970s has swelled the restaurant’s capacity to 360 seats in the barroom, four more distinct dining areas on the first floor (made possible with the purchase of two neighboring buildings to the south), and three more enclaves on a lower level that can double as private dining rooms.

The father-and-son owners now plan to expand up. They are preparing to convert 3,000 square feet on the second story of the three-building complex from office space to a swanky bar-and-lounge.

“It’ll be a little bit of an escape for our guests with a fireplace and a quaint bar,” Craig Huse said. “The current bar [on the first floor] is amazing, but it is a bit of a thoroughfare for people entering and leaving. So this new niche will be a little bit of an oasis for some of our guests.”

Huse expects to begin work on the project by June and complete it before the 2012 Super Bowl in February. The estimated budget for the project is between $1.6 and $1.7 million, which would include moving the second-floor offices to the third floor.

“I don’t think it will have a different name; I think it will just be an extension of St. Elmo,” Craig Huse said of the new space. Some desserts and appetizers likely would be available, including the restaurant’s signature shrimp cocktail.

Mixing the new with the traditional is one of the main challenges for the owners as they happily play curators to the restaurant’s old-school vibe while subtly trying to freshen and improve the eatery.

Restaurateur Stephen Huse and St. Elmo employee Jeff Dunaway purchased the restaurant from owners Harry Roth and Isadore "Izzy" Rosen in 1986 for $2.5 million. (After an acrimonious legal dispute, Huse bought out Dunaway’s 49-percent share in 1998.)

Grand plans to expand the restaurant culminated in a $2 million project in 1997 and 1998 that moved the kitchen from the west entryway to the east end of the restaurant; created the three lower-level dining rooms and a wine cellar; and rounded out the ground-floor eating sections with The Tony Hulman Room.

The wine cellar, which at one time held as many as 20,000 bottles, is an example of the restaurant adapting to the changing dining landscape. “The restaurant really started putting an emphasis on wine once my dad bought it in 1986. That’s the time when wine in general in the United States became a more important part of the meal,” Craig Huse said.

With a larger kitchen, the restaurant started expanding its menu. (In the video below, Inside Dish takes a tour of the kitchen, and discusses elements of the St. Elmo business strategy with Craig Huse.) With the advent of more female patrons, more seafood and salads found their way onto the board of fare. The recent popularity of dry-aged steaks also is reflected among current offerings.



The restaurant also has embraced the online reservation system Open Table, and built a sturdy Internet presence with a website and e-mail marketing. In 2010, St. Elmo spent $195,000 on marketing expenses, including Web-based tools, print advertisements in local and national publications, and sponsorship deals with professional and amateur teams.

 “We’re always focused on the bigger picture and trying to make sure that this place will be around for another 110 years,” Huse said. “That is the goal.”
 

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St. Elmo Steak House
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127 S. Illinois St.
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(317) 635-0636
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www.stelmos.com
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Concept: Quintessential historic steak house, maintaining the character from its early 1900s roots while subtly updating its decor and menu; perhaps the city's primary culinary landmark.
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Founded: By John Stahr in 1902, the same year that the Soldiers and Sailors Monument was dedicated. In the mid-1940s, the brothers Sam, Isaac and Harry Roth purchased the restaurant. In 1955, Isadore ("Izzy") Rosen became a partner with Harry Roth. In 1986, restaurateur Stephen Huse and St. Elmo employee Jeff Dunaway bought the eatery. Dunaway sold his interest in the restaurant in 1998.
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Owners: Stephen Huse (majority owner, 51 percent) and son Craig Huse (minority owner, 49 percent; managing partner).
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Purchase price: $2.5 million in 1986.
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Gross sales: $11 million (2009); $11.9 million (2010).
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Employees: 112 (32 waiters, 15 bussers, 13 cooks, 13 hostesses, 12 bartenders, 9 managerial staffers, 8 dishwashers, 7 kitchen helpers, 3 members of cleaning staff).
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Seating: After several major renovations in its 109-year history, the restaurant now seats 360 in eight distinct dining areas on the ground floor and a lower level).
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Goals: To open a 3,000-square-foot bar-and-lounge on the second level of the restaurant (some of which is currently occupied by administrative offices) before Super Bowl XLVI in February 2012. Estimated cost: $1.6 million.
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Good to know: Food facts—In 2010, St. Elmo Steak House served 37,500 pounds of shrimp in 105,000 shrimp cocktails, accompanied by 3,000 gallons of cocktail sauce; 145,000 pounds of beef; and 130,000 pounds of potatoes (mashed, french-fried, etc.). 
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  • INCORRECT INFO
    STEVE HUSE IS NOT THE FOUNDER OF NOBLE ROMANS, PAUL MOBLEY WAS FOUNDER AND STILL IS CEO, CFO, ETC
  • An Indy Legand
    St. Elmo's is as much a tradition to Indy, as Burn's Steakhouse is to Tampa, or the Big Texan is to Amarillo, Texas. It's defines the community...There are literally dozens of cities with these OUTSTANDING steak houses/chop houses. None of them are cheap, but all of them are outstanding...
  • yesteryear
    my first entry to ST.e was in the late 60s.we had an showroom in the rothchild bldg directly behind the elmo and we would take client buyer from the stores to dinner. my first recall of my liking of marinated herring as an appetizer came those days...we would have 2-4 bodies at the table..those days the restaurant was a shotgun room design..long and narrow...we always had a waiter called "pop" who worked there for 50 yrs or better..oh ya..the bill for 4 in those days was about 50-60 dollars including pops tip and that included and appetizer each...best wishes from a 75 yr old patron still....

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  1. With Pence running the ship good luck with a new government building on the site. He does everything on the cheap except unnecessary roads line a new beltway( like we need that). Things like state of the art office buildings and light rail will never be seen as an asset to these types. They don't get that these are the things that help a city prosper.

  2. Does the $100,000,000,000 include salaries for members of Congress?

  3. "But that doesn't change how the piece plays to most of the people who will see it." If it stands out so little during the day as you seem to suggest maybe most of the people who actually see it will be those present when it is dark enough to experience its full effects.

  4. That's the mentality of most retail marketers. In this case Leo was asked to build the brand. HHG then had a bad sales quarter and rather than stay the course, now want to go back to the schlock that Zimmerman provides (at a considerable cut in price.) And while HHG salesmen are, by far, the pushiest salesmen I have ever experienced, I believe they are NOT paid on commission. But that doesn't mean they aren't trained to be aggressive.

  5. The reason HHG's sales team hits you from the moment you walk through the door is the same reason car salesmen do the same thing: Commission. HHG's folks are paid by commission they and need to hit sales targets or get cut, while BB does not. The sales figures are aggressive, so turnover rate is high. Electronics are the largest commission earners along with non-needed warranties, service plans etc, known in the industry as 'cheese'. The wholesale base price is listed on the cryptic price tag in the string of numbers near the bar code. Know how to decipher it and you get things at cost, with little to no commission to the sales persons. Whether or not this is fair, is more of a moral question than a financial one.

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