Stonewood closes Coastal Grill in Port Orange. What restaurant will take its place?

PORT ORANGE — Stonewood Holdings is closing its Coastal Grill & Raw Bar seafood restaurant here, but the standalone building won't be empty for long.

The building at 1078 Dunlawton Ave. is set to become the newest location for Dahlia Mexican Kitchen whose founder/owner has agreed to lease and renovate it.

The Port Orange location is expected to open in June as the third Dahlia eatery for the locally owned regional Mexican cuisine chain.

Owner Kabir Bhakta opened his first Dahlia Mexican Kitchen in Flagler Beach in 2017 and added a second one at The Shoppes at One Daytona in Daytona Beach two years later. He also recently opened a restaurant called Burger Ten at One Daytona. Burger Ten held its grand opening on March 3.

HOW IT ALL BEGAN:Stonewood chain had an unusual origin story

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'Difficult decision'

Stonewood Restaurant Group informed Coastal Grill's employees on Monday of its decision to close the Port Orange eatery at the end of the evening Tuesday. The restaurant had been in business three-and-a-half years.

"It was a difficult decision. It's never easy," said Tyler Williams, president and chief operating officer for Stonewood Restaurant Group.

"The last couple of years (since the COVID-19 pandemic hit) have been the most challenging years ever experienced in the restaurant industry," said Williams. "After thoughtful considerations and as part of our restructuring plans, we have decided to close Coastal Grill & Raw Bar on March 23, 2022. This strategic decision will allow us to be in a better position to execute our company's growth plan."

Stonewood Restaurant Group also owns eight Stonewood Grill & Tavern restaurants in Florida, including two in Volusia County: its original beachside location on A1A in Ormond Beach and a location on LPGA Boulevard, just east of Interstate 95, in Daytona Beach.

"We expect most if not all of our people (at Coastal Grill) will be reallocated to our other brands," said Williams, referring to the company's Stonewood Grill restaurants as well as the five Volusia-Flagler area Houligan's Sports Grille eateries.

Houligan's is a separate company from Stonewood Restaurant Group, but is co-owned by L. Gale Lemerand, the Stonewood chain's majority owner. Tim Curtis, who co-founded the Houligan's chain with his late father, is a part-owner of some individual Stonewood restaurants that included Coastal Grill.

Dahlia owner 'super excited' to expand to Port Orange

Bhakta said Curtis and Lemerand reached out to him to see if he would be interested in leasing the Coastal Grill property from them.

"We're super excited and grateful for Tim and Gale to approach us with this amazing opportunity," said Bhakta. "They wanted a restaurant with roots in the community. I was over the moon with their offer. This Coastal Grill location is spectacular."

Bhakta, who lives in Ormond Beach, said he and his wife dined at Coastal Grill on several occasions. "My wife and I loved Coastal," he said.

He added that he hopes any Coastal Grill employees who would prefer continuing to work in Port Orange would consider working at the soon-to-be newest Dahlia Mexican Kitchen. He said he anticipates employing 30 to 35 workers.

"I understand that some Coastal workers live close to the restaurant. I asked (Stonewood Restaurant Group) to let those workers know they have an option of working at Dahlia."

Bhakta said he plans to extensively renovate the Coastal Grill building with plans to reopen as a Dahlia Mexican Kitchen in early to mid-June. "Wait until you see what we've got planned," he said.

The concept for Dahlia Mexican Kitchen is to offer a "modern take" on Mexican cuisine, he said, adding that that includes giving his restaurants a modern look as well. "The food you get at most Mexican restaurants in the United States is actually old-school. My wife and I have been to Mexico many times. What Mexicans are actually doing today is very different. We offer cleaner food, meaning for example that we don't use any lard or animal products in our beans, which are vegan. And we only serve cleaner cuts of meat. The beef we use is only certified Angus steak."

Dahlia Mexican Kitchen offers lunch entrees starting at $8.99 and dinner entrees starting at $12.99. One of the chain's signature dishes as its "Steak Del Mar" for $24.99. 

"It's our version of a surf-and-turf that features char-grilled, marinated Angus steak topped with five flash-fried crispy shrimp, Pico de Gallo and a drizzle of queso," said Bhakta. "And we make everything from scratch, including our salsa."

Displaced workers offered jobs at Stonewood's other restaurants

Coastal Grill employed approximately 50 workers. "There may be some, because of transportation challenges, who may not be interested in transferring to our other locations," said Williams. "Our goal is to be able to keep most, if not all, of them continuously employed.

Costa Magoulas, dean of the hospitality and culinary management college at Daytona State College, said Coastal Grill appeared to be a well-run restaurant that got hard hit by a combination of the temporary statewide ban on dine-in service at restaurants during the early months of the COVID-19 pandemic, followed by the area's labor shortage and rising wholesale costs for fresh seafood.

"Seafood now is one of the most expensive items (for restaurants)," said Magoulas. "And the labor shortage hit everybody dramatically and we're still not over it yet."

On the other hand, because of the labor shortage, "there's plenty of jobs and wages are going up," said Magoulas. "So there's plenty of opportunities for the displaced workers."

Closure described as a 'shockwave'

News of the impending closure of Coastal Grill spread quickly on social media on Tuesday with nearly 200 comments posted on the Facebook group "What's Happening in Port Orange" by early afternoon.

"It was my favorite restaurant and the food and employees were great," wrote one. Another wrote that she and her family ate at Coastal Grill last week. "Probably one of the best steaks we've ever tasted. My shrimp were delicious as well. We don't go there often, but after our delicious surf-and-turf meal, we planned on going again and again. ... So sorry they are leaving."

Debbie Connors, the president and CEO of the Port Orange South Daytona Chamber of Commerce, described news of Coastal Grill's closing as a "shockwave." 

"Coastal and before that Stonewood have been a big part of our community," said Connors who lives in Port Orange. "I loved Coastal and ate there many times. They had a salmon bowl that was one of my favorite things. I loved the atmosphere and the service was always good and dependable."

Williams said his company is appreciative of the hard work of the employees at Coastal Grill as well as the restaurant's "loyal guests who have been an amazing part of our brands from day one."