11 March 19 - 25, 2026 dallasobserver.com DALLAS OBSERVER Classified | MusiC | dish | Culture | unfair Park | Contents Hatchet In the Rye It’s hard to be a restaurant in Dallas, even with James Beard and Michelin nods. We look at why Rye on Lower Greenville closed. BY COURTNEY E. SMITH L ower Greenville Avenue became a hub in the mid-1920s, when it was the main thoroughfare to reach points north before High- way 75 was built. The area has become what it was developed to be: A neighborhood with numerous popular spots to eat, drink and shop. It now serves as a home base for three Michelin-recognized restaurants (used to be four — keep reading), along with a handful of long-standing dives, brunch spots, sports bars and more. All within walking distance of one another on tree-lined sidewalks. Rye seemingly thrived as a super seasonal small-plate restaurant and cocktail bar. The 2024 Michelin Guide recognized it for its Ex- ceptional Cocktail Program, striking a bal- ance between the drinks and the seasonal tasting menu. In 2025, it was named a semifi- nalist for Outstanding Bar by the James Beard Foundation. The tasting menu was regularly heralded as one of the best in the city. Despite these accolades, in January the owners an- nounced that Rye would close in early March. The space will become a second room for Apothecary, its sister bar next door. Why is such a celebrated restaurant shut- ting its doors? Death by Permit Closing time is a big issue for restaurants and bars. Last summer, a bar in Deep Ellum told the Observer it generated $80,000 in revenue per month from midnight to 2 a.m., double what it made from 6 p.m. to midnight. Rye closed nightly at midnight because the owners were unable to secure a specific- use permit that would have allowed them to stay open and serve alcohol until 2 a.m. The permit has been required for Lower Green- ville businesses since 2011. “Had Rye been able to go later, maybe we wouldn’t be hav- ing this conversation,” says Tanner Agar, CEO and co-owner. Rye’s owners began seeking the permit in 2021. There were many stumbling blocks. First, they were told they had to wait until they’d been in business for a year. In 2022, when they tried again, Agar says the Lower Greenville Neighborhood Association (LGNA) did not support the request. (LGNA president, Jean McAulay, told the Observer via email that the association has not come out for or against this business.) Agar met with the neighborhood associa- tion and even hired a consultant to help nav- igate the process. But the LGNA told them they didn’t like that consultant, wouldn’t work with them, and to hire a consultant they liked. Agar ate the costs to do that. “When Rye previously pursued late- night hours several years ago, the property had outstanding code issues,” Councilman Paul Ridley, who represents District 14, told the Observer in an email. “My plan commis- sioner made it clear at the time that they could revisit the late-night SUP once the is- sues were resolved. That did not occur.” Agar says the restaurant was never issued a code violation by the city. One person from the neighborhood objected to the condition of Rye’s parking lot, and the permit request was put on hold in 2022 until the lines to de- lineate parking spaces were redrawn. The owners pursued but did not file for a permit in 2023, focusing on resolving issues with enclosing their patio. According to Agar, LGNA’s objections to the City Council prevented approval when the restaurant re- applied in 2024. Although city staff recom- mended approval, neighborhood pushback led council members to state they would op- pose the late-night permit. They warned that if the restaurant forced a vote, it would not be able to reapply for two years. “I felt threatened when they said, ‘If you push this farther, you’re gonna get blocked from ap- plying for two years,’” Agar says. They did not seek a permit in 2025 be- cause Agar and his partners were focused on opening Flamant in Plano. But the plan, go- ing into 2026, is to start the process again so Apothecary, which is classified as a restau- rant by the Texas Alcoholic Beverage Com- mission, could stay open until 2 a.m. Agar is unsure why his businesses have gotten so much pushback from the neigh- borhood. “I would think that a soundproof room, where everyone is seated, and the po- lice have never had to visit, would be the kind of place that could get approved,” Agar says. “I guess not.” Other businesses have received permits, including Greenville Avenue Pizza Co., the Libertine and Alamo Club. Voodoo Dough- nut and Fortune House have applications coming before the City Council soon. Food Costs That’s not the only mess Rye’s owners have had to try to untangle. The soaring cost of food and goods also affected it. Much has been made of the Trump ad- ministration’s tariffs affecting food costs, and while Agar doesn’t entirely attribute the ris- ing costs to the tariffs, he notes that the res- taurant’s produce bill rose 40 percent year over year. With larger vendors, Agar says the cost of the food chain before it reaches him isn’t transparent, but when he talks to small farmers, it’s hard to argue that their prices keep rising because of animal production costs. It is a byproduct of a volatile market in which prices for everything, across the board, fluctuate and at times skyrocket, then take a long time to return to normal. Then, there’s the rent. Some successful restaurant groups, for example, Duro Hospi- tality, only open restaurants at properties they own. Agar says he and his partner Tay- lor Rause don’t have investors or family money to lean on, so they lease space. “What people don’t seem to know is that everything that happens in the building, unless it’s a leaking roof, is our responsibility.” Plumbing issues, equipment, upgrades, design: it all falls to the tenant. Slumping Business A problem plaguing restaurants across the city is a dip in traffic, as continuing inflation has diners tightening their budgets. For Rye, it’s not a recent development. Rye has been on a cycle many local restau- rants operate on, where the holiday season is often big enough to get them through slow seasons, like summer. The 2025 holidays weren’t good, Agar says, and they haven’t been for a few years. Agar and Rause created a menu theme for the summer of 2025, hop- ing to attract more customers. They also ex- pected a busier fall, but it never materialized. “As the good period gets smaller and shorter, we’re looking at the holidays and big party bookings and saying, the way this is go- ing, 2026 is not trending how we need it to for a big enough response to turn it around,” Agar says. Rye’s December numbers, the bus- iest month, were not enough to keep it open. Surcharge Then there were those who didn’t like the restaurant’s politics. In 2023, Rye intro- duced a 3% optional surcharge on checks to fund employee health insurance and bene- fits. For Agar, it was an exercise in transpar- ency. He wanted customers to know what they were paying for, rather than raising menu prices and passing along costs. The re- sistance, from people who had eaten there and many who hadn’t, was loud. It contin- ued to the bitter end. One of the first re- sponses to a Dallas Morning News Instagram post about the closure, with 22 replies, blamed Rye’s closure on the surcharge. Agar also introduced the concept, which is popular in coastal cities, hoping it might take off in North Texas. “I don’t think it’s probably something that will be widespread in Dallas,” Agar says now about the experience. Location, Location, Loca... Finally, the restaurant faced an existential question: Does it belong in this neighbor- hood at all? According to Agar, attracting diners who can afford Rye’s price point has always been a challenge. “I’ve talked to guests who say they never go east of 75,” he says. For guests who became fans of its original location on the square in McKinney, many still visit and, Agar adds, complain about how long it takes to get all the way down to Dallas. He echoes what many operators are worried about these days: That as more and more people move to the north- ern suburbs of Dallas, they have less reason to come to the city to visit restaurants. ▼ TEX-MEX OF COURSE EL RANCHITO IS A LANDMARK WANT A SIDE OF HISTORY WITH THAT TABLESIDE MARIACHI PERFORMANCE? BY AUSTIN WOOD A historic Oak Cliff institution featur- ing tableside mariachis got a formal nod from city officials recently. Dallas’ planning commission approved a “historic overlay” for the eccentric El Ranchito building, tentatively designating it as a historic landmark, pending City Council approval. The designation will protect the structure from demolition and heavily re- strict renovation incompatible with its exist- ing character. What’s that character? El Ranchito is an upbeat community in- stitution in Oak Cliff and a gathering point for Charles Dilbeck enthusiasts, dozens of whom gathered at the restaurant in 2023 to celebrate what would have been the re- nowned Dallas architect’s 116th birthday. First home to Red Bryan’s Smokehouse, the building El Ranchito occupies was de- signed by Dilbeck ahead of the barbecue joint’s 1947 opening. Laura and Oscar San- chez, originally from Monterrey, bought the building in 1983 after success at La Calle Dolce and brought authentic Northern Mexican cuisine to the space. Span- Chris Wolfgang Cacio e pepe from Rye. | CITY OF ATE | ▼ Dish >> p12
