Raised eyebrows over Pemberton brothers SLO project

May 7, 2015
Jeremy Pemberton

Jeremy Pemberton

By KAREN VELIE

A pair of developers whose prior business deals resulted in claims of fraud and a bankruptcy with $1.4 million in unpaid wages, debts and charity pledges that were never fulfilled have started looking for investors in a project in downtown San Luis Obispo.

Jeremy and Joshua Pemberton, twin brothers, have begun to solicit investors in their project to turn the site of the San Luis Obispo Sports Authority into a bowling alley, restaurant and performance site for live music. The goal is to open in late 2015.

The business plan summary for the project lists Copeland Properties and Jamestown Properties as partners with a commitment to contribute $2 million of the roughly $5 million that the Pembertons say the project will cost.

Owners of restaurants in San Luis Obispo have raised eyebrows over the $5 million cost of the downtown project saying that the amount is much more than should be needed. The owners say that providing an adequate return on that much of an investment is not likely to happen.

The restaurant owners are especially wary considering the Pemberton brothers’ history in Santa Barbara.

In mid-2007, the Pembertons created Twiin Productions with a goal of producing live shows in Santa Barbara County. The Pembertons were able to attract several large investors and well know promoters to work with them and support them.

However, within a short time the company was accused of failing to pay its bills and follow city rules and regulations. By mid-2010, the Pembertons were battling a lawsuit from concert promoter Jacalyn Kane, a former partner, for fraud, breach of contract and 11 other causes of action.

In 2010, the City of Santa Barbara denied the Pembertons’ application for a permit to hold a three-day concert based on complaints city staff made about the Pembertons’ 2009 West Beach Music and Arts Festival.

Josh and Jeremy Pemberton, photo by Noozhawk

Josh and Jeremy Pemberton, photo by Noozhawk

“Unfortunately, the 2009 Festival was marred by a number of problems as a result of poor event management by Twiin Productions and a lack of city policies and regulations related to events of this size and scope,” a June 2010 council agenda read.

Santa Barbara city staffers reported a number of problems with the Pembertons’ 2009 Music and Arts festival. Twiin Productions failed to pay bills to the city for increased police presence, bounced a check to the city and failed to follow permit requirements and city rules, said Santa Barbara Parks and Recreation Director Nancy Rapp.

Twiin Productions also made up counterfeit Waterfront Parking VIP permits which were used by the organizers and some of their vendors, Rapp said.

“They said, ‘So sorry about the permits it was someone in our organization,’ but it is still fraud,” Rapp said.

Jeremy Pemberton said he did not agree with all of the city’s claims about Twiin Productions.

“There was a lot of inaccurate information,” Jeremy Pemberton said in response to the city’s allegations of theft and fraud. When asked to be more exact, he said, “You can’t battle a city so we moved on to Ventura and now San Luis Obispo. You just move on.”

In the end, Santa Barbara permitted Twiin Productions to do a smaller two-day event in Sept. of 2010.

In Nov. 2010, Twiin Productions filed bankruptcy claiming $9,750 in assets and $1,431,201 in liabilities including unpaid wages to employees, clothing expenses, dry-cleaning bills, jewelry store debt and money owed to non-profits.

In a press release emailed shortly after they filed bankruptcy, the Pembertons’ attorney Joshua Lynn blamed the City of Santa Barbara for creating so many “unprecedented and inconsistent governmental and bureaucratic obstacles” that the Pembertons were unable to succeed.

Jeremy Pemberton’s Linkedin page includes claims that non-profits including the Westside Girls and Boys Club were beneficiaries of Twiin Production events.

However, the bookkeeper for the Westside Girls and Boy Club said that neither the Pembertons nor Twiin Productions has ever donated to the club.

Jeremy Pemberton later explained that Twiin Productions permitted a group of young people involved with the Westside Girls and Boys Club to work the event and did not charge them an entry fee. As such, the entry fees were a donation, he said.

Jeremy and Joshua Pemberton promoted several charity events to help the victims of a handful of Santa Barbara County fires. Sources said the twins failed to pay several charities and bounced checks to other charities. The bankruptcy notes $6,500 owed to Firefighters Quest, a charity that provides relief to burn victims.

Jeremy Pemberton said the bounced checks and debt to Firefighters Quest happened five years ago and that he could not remember.

Several years after filing the bankruptcy over their Santa Barbara enterprise, the Pemberton brothers raised $2.8 million for Discovery Ventura, a bowling alley, restaurant entertainment venue they opened in Jan. 2014. In order to fund the project, the brothers secured money from almost 30 investors. Jeremy Pemberton said the brothers have already began sending interest payments to their investors, though he refused to disclose the percentages.

discovery SLO

Plans for the $5 million Discovery San Luis Obispo entertainment center include a 14-lane bowling alley, a restaurant and a bar and banquet area.

In their Discovery San Luis Obispo business plan summary, the Pembertons calculate that 35 percent of revenue will come from bar sales and 24 percent from food sales. But new restaurants and bars in San Luis Obispo are required to have a split of at least 50 percent food sales in comparison to alcohol sales.

Jeremy Pemberton said he is aware of the 50 percent food rule. He said that the revenue figures in the San Luis Obispo business plan summary are different from what will occur when they are required to follow “specific conditions.”

The Pembertons are slated to bring their plans before the San Luis Obispo Planning Commission this summer. The brothers already have filed for a conditional-use permit to allow alcohol to be served past 11 p.m. at the 24,500-square-foot space located on the corner of Chorro and Marsh streets.

Discovery SLO Business Plan – Executive Summary by CalCoastNews

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BigRed

Entitled d-bags who externalize their previous failures. This should be fun to watch. The shoe rental should really clean up the fuzzy math in the business plan.


hijinks2

The only reason this article came out, or that is the information was released is that they failed to pay homage to the planning and building department in SLOTown USA. Come on guys, you know how it works – a little cash to family member gets your project approved. Just look into the net worth of some of the crooks in the planning department. It is all there, free trips to costa rica, long bike rides up to hump back mountain during the day with your boss – oh that last part is a staff member and boss issue.


pasoparent5

Maybe I missed it, but how old are these guys? Just curious…they look so young!


SLO_Johnny

We had a bowling alley in SLO on Laurel Lane. It went bust and was turned into an Alzheimer’s care facility. It won an award for remodeling.


This downtown project isn’t really a bowling alley. It’s a bar with a bowling alley attached.


aft50s

Do young people still bowl as a means of recreation? I don’t see a lot of them doing so in Pismo Beach.


Just curious…


SLO_Johnny

CAL Poly has some lanes. The kids seem to use them when they get bored; especially the students who are too young to visit a bar.


NorthCountyDude

Yes young adults still bowl at Pismo. I do and during busy weekend nights there are is waiting to get a lane.


It’s still affordable fun. Less than going to the movies.


hijinks

These guys aren’t the only local developers with dirt in their backgrounds.


See


http://www.pe.com/articles/homes-665759-dirt-home.html?page=1


for the goods on fair haired boy Gary Grossman.


kayaknut

If you are talking questionable developers don’t leave out Nick Tompkins.


fhill123

Something may be rotten in Denmark but it also stinks in SLO which I believe is now illegal.

Anyone investing with such good business people get what they deserve.


isoslo

Only a fool would invest with people with such a poor track record, with small businesses the key is always the people not the business plan. Maybe Karen Guth can help them find some investors. My promise to all investors is, this investment will produce substantial tax losses for years to come.


hijinks

“Only a fool…” You got it. That’s why the Copelands are backing it, backed up of course by the hundreds of millions of Jamestown loot they can call upon. The city gives Copelands a below-market lease, and they pay us back with another downtown bar. Nifty.


isoslo

Don’t the Copelands own the land and building? If so maybe they are just lending their name so they can get a group suckers to sign another over-priced lease


SamLouis

They don’t — but they control the lease…


SLOBIRD

I believe the City owns the site…


kayaknut

Sounds like they will fit right in with SLO city government.


Mike

Maybe they can open a branch office in Atascadero?