Kevin Bronson on December 6th, 2023

1

The Federal Bar, the stylish North Hollywood gastropub that also houses the second-floor music venue the Knitting Factory NoHo, is shuttering at year’s end.

“This one weighs heavy on all of us,” Morgan Margolis, CEO/President of Knitting Factory Entertainment, said via email. “[We have] incredible staff and patronage and [this was] our first foray into the hospitality world outside of owning music venues. I would have 100% stayed open even if at break-even, or a slight loss, but the numbers just buried this one.”

Knitting Factory Entertainment opened the Federal Bar, at 5303 Lankershim Blvd., in 2011 in a renovated historic bank building that previously housed a venue called Bank Heist. It was gutted by fire in 2008. The second-floor space was a venue for live music, comedy, dance nights and private events before officially becoming the Knitting Factory NoHo last year.

Margolis cited both the aftereffects of the pandemic and the declining neighborhood for the closure.

“Look, it was an incredible run of 12 years,” he said. “We had 10 great ones and two rough ones into the pandemic and coming out the other side, we carried [on] as long as we could, but we also didn’t see a dime of the Restaurant Revitalization fund (that program dried up fast!), [although] some of the PPP money helped.

“Factors involved were revenue drops by more then 50% from prior years. Carrying the venue for the last two years, taking losses,” he added. “The North Hollywood corridor above Magnolia on Lankershim is in major decline (I’m being nice, it’s a disaster up there!). Constant battle with the drug/crime situation here. We had to have security during the day for quite some time, it got too costly and we just made the decision to shut down lunch. The last six months during the union strikes took their toll as well. So, in term of influences, a collision of many: rough area in decline, little help from the city on battling the problems. Revenue drops in general, event and room rentals down as well, daily and nightly patronage way off. Keep in mind this is also a very large, 10,000-square-foot space with a huge overhead between rent, insurance, wages … It just got too heavy.”

Margolis noted that KFE’s other ventures are holding their own, or better. “Our other bars in the area, Cantiki, El Tejano and Thirsty Merchant are all holding decently, but [they’re] sitting in different locations, [with] much smaller spaces and overheads. We are also partnered on the Regent Theater downtown, which is doing very well.

“The pandemic knocked out thousands upon thousands of restaurants across the world — it’s an extremely tough business, to state the obvious, with thin margins. Some work, some don’t. No one has the crystal ball of what will hold and what won’t for the long term. I’m proud to have gone 12 years with the Fed family. They made this place, and without them, no way we would have been the staple we were and are for the moment.”

The Knitting Factory music venue will be seeking a new location, according to the Federal Bar’s announcement on social media. Previously scheduled shows are expected to be relocated.

The Knitting Factory NoHo will go out with a bang, as the Aggrolites will perform there on New Year’s Eve.