Carmelo’s Italian Restaurant closing; land sold to Houston-based company

One of Austin’s longest-running fine dining restaurants will see its 32-year run come to a close in the coming months. Carmelo Mauro will shutter his namesake Italian restaurant in downtown on Father’s Day, June 18. Mauro sold the property at 504 E. Fifth St. in March, according to county records, and cites rising property tax prices for the closure.

Mauro said he believes the new owners, listed as AHC-Seazen ODH LLC, intend to build a high-rise condominium on the plot of land at Fifth and Red River streets. According to state records, AHC-Seazen is connected to Houston-based firm Allen Harrison Company, which develops multi-family apartment buildings. The Statesman has left a message with a representative for the buyer.

Mauro first opened Carmelo’s in Houston in 1981 after arriving from his native Sicily in 1978, and opened the Austin location in 1985. The restaurant is located in the 145-year-old building that once the housed Old Depot Hotel, recorded on the National Register as a Texas Landmark.

The painted courtyard of Carmelo’s Italian Restaurant on Fifth Street in Austin.

Mauro said he never intended to sell the land, which he purchased in 1992, but that property tax increases in recent years made staying impossible. According to the Travis County Appraisal District’s website, the property was appraised around $3 million in 2014 and rose to just over $5 million last year. Mauro said his restaurant would have to do $8 million-$10 million in sales annually, a number he says is unfathomable, in order to remain profitable.

“We are not here to become wealthy but because we love what we do,” Mauro said. “But at one point if you work just for the tax man then it is not fun anymore.”

Carmelo’s parking lot had helped Mauro generate extra revenue in recent years. The space played a major role during South by Southwest for 2012 to 2014, with Doritos building a massive stage on the lot. But an ordinance passed by the Austin City Council in 2014 to regulate public safety during SXSW kept Carmelo’s from being able to obtain a permit to host such shows in its parking lost, according to Mauro. Mauro said the change cost his business hundreds of thousands of dollars, which he would have used to defray the rising tax cost.

Mauro thinks local government is making financial concerns the primary factor in Austin’s growth, a move that puts the city’s unique culture at risk.

“They are on a mission and their mission is to get as much money from the business community. The tragedy is there is no cap on businesses, so they can increase as much as they please,” Mauro said. “They forgot who made this corner. Now they are looking for the top bananas with a lot of funds.”

Carmelo’s was once one of the hottest spots in Austin, home to special-occasion family dinners and a regular dining destinations for some of the city’s power players. When Anne Richards was elected governor in 1990, the Statesman’s Lee Kelly wrote that lunches at La Zona Rosa and dinners at Carmelo’s Italian Restaurant were “in.”

Mauro, who served as president of the Texas Restaurant Association from 2007-2008, was recognized in 2001 by the National Restaurant Association as the group’s Cornerstone Humanitarian of the Year, and he regularly participated in charity and community events, including last year’s “Austin Loves Amatrice” benefit following the devastation earthquake in Italy.

“The beauty of Austin through the years is we were able to get involved with a lot of charitable organizations and helped raise substantial amounts. So we were part of the community, and we will always be a part of the community,” Mauro said.

Mauro gave three months notice to his staff, in hopes they’d have time to find new jobs. Some of the employees at Carmelo’s are children of some of the restaurant’s original employees, according to the owner. 

The closure in Austin will not affect the original Houston location in that city’s energy corridor.

“Houston is more sensitive when they increase,” Mauro said. “Five or 10 percent.”

Carmelo will spend time in his restaurant in the weeks leading up to the closure, hoping to get a chance to say goodbye to many of his longtime customers and employees.

He closes the Austin chapter of his restaurant life with mixed feelings.

“It’s a shock to each one of us. So even though I cashed in, there is no celebration,” Mauro said. “The heart tells you one thing but the brain says it’s time.”

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