At D.C. Club, a $2 Million Minimum
Wednesday, January 17, 2007
Brian Shulman, 36, strolled into Nexus Gold Club, the pocket of his gray wool peacoat stuffed with a wad of bills bound in a rubber band -- $10,000 mostly in 20s, he said -- as he prepared to bid on the club's nude-dancing license.
But the $2 million minimum was too high, he decided, and neither he nor anyone else made a bid. Bidders also passed on two dance cages, complete with hydraulic-lift stages, that were going for $5,000 each. The auctioneer had more luck with the two 13-foot dance poles, which quickly went for $50 to Daniel Clark of Severn.
"I have an arcade in my house, and I figured they'd be kinda a kitsch item," said Clark, who runs a business that sells glow-in-the-dark paint. "You have a unique and interesting thing to talk about. They came from a real strip club. It's a conversation piece."
The attempt to sell the strip club's license produced talk but no bidding from Shulman, his partner and seven other would-be buyers. The license was being auctioned because the land where the club sits, in Southeast Washington near the site of the new baseball stadium, was sold last year in a $40 million deal as the neighborhood gets redeveloped into housing, retail and office space. JPI, a developer from Irving, Tex., plans to put luxury apartments and retail space on the site.
The license was being sold by club owner Ron Hunt, and as one of only 20 such licenses in the city, which has a moratorium on issuing additional licenses, it was considered a valuable asset.
Shulman, with thin-frame glasses, button-down shirt and khakis, looked more like a grad student than co-owner of Scores, a Baltimore strip club. But at $2 million, he decided the license was risky business.
"You're buying an asset that essentially can't be moved because there's so many approval hurdles to open a gentleman's club," Shulman said. "The city has been so developed with high-end real estate. People spend millions for a house, they don't want a gentleman's club next to it. There's no guarantee you could do it."
While the license allows an owner to open a club with nude dancing anywhere in the city that has commercial zoning, a club must sit at least 600 feet away from any schools, community centers and housing. Community members can protest the opening of such a club, and it must get approval from the District's Alcoholic Beverage Control Board.
Chris Rasmus, president of R.L. Rasmus Auctioneers, said four people at the auction were interested in the license and had the required $10,000 deposit in hand. Two people called in -- one from Las Vegas, the other from Philadelphia -- and one bidder didn't meet all the requirements to place a bid.
Those who came to bid were mostly reluctant to give their full names. They included a tall, sturdy man in a black suit with a skinny black tie. He gave his name only as Adrian. He recently paid $3.8 million for the land and strip club called 1819 on M Street NW. Two young entrepreneurs -- one in a black chinchilla coat and the other in a black fedora made from beaver fur -- promote hip-hop artists and comedians. There was also a bald Baltimorean who owns a swinger's club called Tabu Social Club.
"These are seasoned generals coming in here to look at that license," said Tracy Wiggs, chief executive of Jus' Wiggin Entertainment in White Plains. "Look at that guy coming," he said, pointing to a man in wire-frame glasses, a flat cap and beige jacket. "He's right out of the Sopranos."
Rasmus sold dozens of other items, including sound equipment, cocktail tables, lights, marble countertops, arcade machines and beer coolers. He said the license now will be auctioned either by sealed bid, over the Internet or by conference call.
"There's no doubt in my mind it can sell at that price," he said of the $2 million minimum.