O.C. Restaurateur Will Help Taco Bell Create New Chain

David Wilhelm, the restaurateur behind trendy Orange County eateries Diva, Bistro 201 and Kachina, is going to work for Taco Bell.

Taco Bell?

The Irvine-based fast-food company announced Monday that it plans to open a nationwide chain of upscale restaurants with a Southwest flavor and has recruited Wilhelm to help design the motif, decor and menu.

Wilhelm, who will continue to run his own restaurant group, would not speculate on what diners might expect from the new venture. “How about we say it will be more than Taco Bell’s 99-cent meal,” he quipped, “and less than Kachina,” his Laguna Beach restaurant, where a dinner for two with a bottle of wine runs about $50.

How can a haute cuisine practitioner help Taco Bell?

“David Wilhelm’s record of success in this area speaks for itself,” said Taco Bell President John Martin. “He is a tremendous innovator and has a terrific knack for understanding the American palate and developing unique dishes that have made his restaurants among the most popular in Southern California.

“He will be an enormous asset in helping us create a new concept that will drive home quality, service and value for Southwestern dining.”

For Taco Bell, a subsidiary of Pepsico Inc., the venture with Wilhelm will be the second in sit-down dining. Last month, the company acquired Chevys, a San Francisco-based restaurant chain with 37 locations, and said it intends to expand it to 300 Mexican-style restaurants nationwide.

Monday’s announcement drew some rave reviews from industry analysts and even a local competitor. The alliance of Wilhelm and Taco Bell’s Martin may be unusual, they say, but it also may make sense.

“Like most good business deals, this will work if each guy does what he does best,” said Hank Adler, a partner in the Santa Ana office of national accounting firm Deloitte & Touche. “Nothing John does surprises me, and you certainly can’t say anything about Wilhelm other than that he’s an amazing success.”

Antonio Cagnolo, owner of Antonello Ristorante in Santa Ana, also sees potential in the alliance.

“If I were Taco Bell and had the money, I’d go out there and get the best (Southwestern restaurateur) there is,” Cagnolo said. “I know if Taco Bell said they’re opening up an Italian chain and they want me . . . I’ll go.”

Janet Lowder, a Rancho Palos Verdes restaurant industry consultant, said: “If Taco Bell wants to be in the full-service, Southwestern cuisine restaurant business, the best way to approach it is with someone who has had experience with it in the past. . . . That way you get their experience coupled with your capital resources.”

Wilhelm will continue to be involved with West Coast Restaurant Ventures, the management group that runs his current restaurant businesses, including Kachina, Bistro 201 in Irvine, Zuni Grill in Irvine, Cafe Topez in Santa Ana and Diva in Costa Mesa. He also was instrumental in introducing Roxbury, a popular Los Angeles supper club, to Orange County.

Taco Bell officials were vague about what the decor and menu for the new restaurant chain will be: “Whatever it is that they’re going to create doesn’t exist yet,” said Jeff Lightburn, a Taco Bell spokesman. The company also could not say Monday when the first unit will open or how many locations are planned.

Lightburn said that Chevys, where customers typically spend about $8 a meal, will continue to offer moderately priced, family-oriented dining. The still-evolving Southwestern-style chain is expected to generate “higher check averages,” he said.

The Taco Bell-Wilhelm venture, analysts said, will compete in the casual dining segment that includes chains like Red Lobster and Olive Garden, both operated by General Mills Inc. of Minneapolis.

Taco Bell, with $2.5 billion in annual sales, is positioning itself to serve Baby Boomers, who are gradually shifting from fast food to sit-down restaurants.

“There’s plenty of room for growth in the casual dining segment,” said Craig Shulstad, a spokesman for General Mills. His company already operates more than 1,000 Red Lobster and Olive Garden restaurants in the United States and Canada, and it is adding about 100 locations each year. It is also experimenting with a handful of China Coast restaurants that serve Asian-style foods in a casual dining atmosphere.

Adler of Deloitte & Touche said he isn’t surprised by Taco Bell President Martin’s decision to expand into more formal dining. “If you know John, you know he’s really a connoisseur of fine foods,” Adler said. “Though his business is fast food, for him a good night out is a first-class restaurant.”