(Wendy Maeda/Globe Staff)
This story was updated Tues., Dec. 6, at 12 p.m. to add a statement from The Hamilton Company, which owns the space in Allston that Kelly's Roast Beef leases.
The iconic family-run restaurant chain Kelly's Roast Beef will close its Allston restaurant this weekend, company officials said today.
The newest of Kelly's six locations in Massachusetts will bid farewell after a final day of business Sunday, Dec. 11, ending its one-and-a-half year run in a prominent spot at the busy corner of Harvard and Commonwealth avenues. It's one of a number of changes to the Allston Brighton business scene in recent months.
"Our company is still growing, but it just didn't work out for us at this location," Dean Murphy, director of operations at Kelly's, said today by phone. "Allston's a great neighborhood. Unfortunately, we couldn't maintain the sales level needed."
The franchise was born on July 3, 1951, when the original eatery opened on Revere Beach, he said. After opening four suburban locations, the company brought its surf and turf menu to Boston in May 2010 when it opened a 5,000 square-foot, 132-seat restaurant in a former liquor store space in Allston.
For the first time in Kelly's 60-year history, the company will lay off workers, who were given prior notice of the closure, Murphy said.
"It's a terrible time to lose a job," he said. "Unfortunately there will have to be some layoffs. We've never done that before."
While all of the employees who had transferred from another Kelly's restaurant to work at the Allston location will be able to continue working with the franchise at another of its five spots, around 20 of the 35 workers at the Allston eatery will be laid off, according to the operations director.
No business has been lined up to take over the space, but Murphy said the company is open to all options. Kelly's has eight years remaining on a 10-year deal the company signed to lease the space from the property's Allston-based owner, The Hamilton Company.
"Kelly’s will be actively marketing the space for rent and we are very hopeful that the space will provide a home to a successful business in early 2012,” said a statement from Carl Valeri, president and chief operating officer of The Hamilton Co.
The restaurant's closure will bring a second large street corner business vacancy to the Allston intersection. A 5,600 square-foot commercial space across Commonwealth Avenue from Kelly's has been empty since spring 2010 when Uno Chicago Grill closed its restaurant there. TD Bank signed a 15-year lease for the space in February, according to state land records, and plans to open a branch there in the second half of 2012, according to a spokesman for the bank.
With no parking lot of its own, few available spots nearby and no drive-thru, Kelly's business concept struggled to bring in enough revenue to stay in operation, according to Murphy.
He said four of the other five Kelly's restaurants -- in Saugus, Natick, Danvers and Medford -- have a drive-thru window and offer parking. The flagship location on Revere Beach has neither, but benefits from heavy beach pedestrian traffic, a walk-up window and available parking options nearby.
And, Murphy added: "Kelly's operates with a higher food costs than typical restaurants."
He said those higher costs come from the company's focus on serving fresh, quality, made-to-order food, in portions he said are larger than other comparable restaurants and prepared by staff who are generally paid higher wages than at competitors.
The franchise "put in a lot of money into [renovating] the [Allston] building," which like its other locations features a style 1960s style with decorative carousel horses and beach- and boardwalk-themed murals. And, Kelly's spent more to keep the space cleaned and well-maintained.
“We are obviously very disappointed with the closing of Kelly’s. We had high hopes for their success,” said the official from the local, 58-year-old real estate company that owns the Allston property Kelly's leases and says it manages more than 5,000 apartments and 3 million square feet of commercial space in Greater Boston. “It would appear that the menu’s prices were ultimately too high. The owners of Kelly’s, as well as The Hamilton Company, invested a substantial amount of money into renovating and converting the location."
Murphy said Kelly's, which claims to sell 1 million roast beef sandwiches annually, is looking to open other locations, though there are no definite plans to announce.
"We're certainly considering all areas at this time," he said.
E-mail Matt Rocheleau at email@example.com.
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