On Saturday, San Francisco’s food industry was shaken by the announcement that acclaimed chef Mourad Lahlou’s fine-dining restaurant Mourad would close at the end of that evening’s service. In the Instagram announcement, the chef blamed a “bitter dispute with city officials” as one of the reasons for the closure.
Reached by phone on Monday afternoon, Lahlou said he made the decision after a months-long fight with the city over property taxes his business accrued during the pandemic and in the years that followed.
Lahlou believes he should not have to pay those taxes in full — which are levied on a business’s equipment and leased space — since the restaurant was closed from March 2020 through May 2021 and because the SoMa neighborhood has been so slow to recover, making it difficult to operate profitably.
Lahlou said he asked the city to lower the assessed value of the property to reflect the difficulties SoMa restaurants have faced since 2020, which the city would not do. “We’re not talking about North Beach or Hayes Valley, we’re talking about downtown San Francisco,” Lahlou said. “Maybe they just don’t want us here.”
Court documents obtained by The Standard confirm the city sued the restaurant for more than $88,000 on June 5. According to the filing, the restaurant, which operates as Montgomery Restaurant Partners LLC, owed the city more than $63,000 in unsecured property taxes from 2022, as well as an additional $25,000 in penalties and interest.
According to Lahlou, he was given 10 days notice to settle the debt; when he was unable to do so, he woke up to find the restaurant’s operating account had been emptied by city collectors overnight. “We had payroll and vendors to worry about,” he said. “But [the city] didn’t give a fuck.”
That amount, however, appears to be just a portion of the money the restaurant owes the city. According to tax records, Mourad’s company also has unpaid tax bills from 2020 and 2021, plus an additional unpaid bill from 2022. In total, the additional debts come to more than $50,000. A 2024 bill for $64,000 also became delinquent on Sept. 3. Lahlou said he was notified of that bill last week, which resulted in his decision to close the restaurant
In an emailed statement to The Standard, Amanda Kahn Fried, chief of policy and communications for the Office of the Treasurer & Tax Collector, said forcibly collecting taxes “is not a decision we take likely given the impact it can have on a business.”
The mounting debts appear to coincide with the departure of the restaurant’s former director of operations Scott Chilcutt, who on Friday told The Standard he’d parted ways with the restaurant “several months ago due to serious disagreements with Chef Mourad about business decisions.” Though Chilcutt filed documents indicating he was the managing partner of the restaurant company in 2020, filings from earlier this year list only Lahlou’s name as a manager or member.
Chilcutt did not respond to a request for comment.