Representatives for a Denny’s franchisee recently confirmed plans to renovate Sherman’s former El Chico Café restaurant building into a new location for the diner-style restaurant chain.


Denny’s previously had a Sherman location along Texoma Parkway in what is now the home of Sweetberries Café. However, the chain closed the location some time around the year 2000, city officials said. El Chico announced in mid-2018 its was vacating its Sherman location, effectively leaving the market.


“I think that Denny’s views Sherman as a high growth market and a lucrative market,” JD Gonzales, who helped broker the deal for the restaurant, said Thursday on behalf of franchisee Syed Ahmad.


Gonzales said Sherman made for a prime location for a Denny’s restaurant due to it being on a high traffic corridor north of the Dallas-Fort Worth Metroplex and near the casinos in southern Oklahoma.


While Gonzales served as the broker for the deal, he attributed a lot of credit to Sherman Assistant City Manager Terrence Steele, who helped guide him through various locations throughout the city. Steele said he spent nearly five hours showing off various sites, including the Sherman Crossroads and the Sherman side of the Hwy. 75 and FM 691 intersection. Steele said he never expected that developers would be more interested in the former Mexican restaurant site than other pieces of prime real estate in the city.


“I was shocked that they came back and chose the El Chico building,” he said.


The developers were more interested in the U.S. Highway 75 and U.S. Highway 82 intersection and sites closer to Denny’s prime competitor — IHOP.


“The owners’ exact words were that they feel their products can compete with their’s (IHOP’s) and they have no problem being close,” Steele said.


Denny’s customarily secures land in one-acre tracts in order to build its locations, Gonzales said. However, it is not unheard of for the company to acquire second-generation buildings as part of a cost-savings approach. Gonzales said the project will likely cost more than $1 million, but that would be significantly more expensive if developers had chosen a bare site.


With regard to the former El Chico location, Gonzales said it had the advantage of having ample parking and cross access along with its proximity to the Hwy. 75/82 intersection. He noted the location also has direct access to the off ramp to northbound Hwy. 75, making it easy for motorists on the highway to reach to the restaurant.


The building will likely need to be renovated to meet the look of many of the company’s existing restaurants. Denny’s maintains several different designs, but Gonzales said he was uncertain which would be the best fit for the Sherman location.


The first step toward renovating the building will come as engineers assess the structural integrity of the building. From there, other changes, including new furniture and equipment, can be added.


“You’ve got to give the building a lot of love,” Gonzales said. “Denny’s and many contemporary dining restaurants use a lot of modern equipment that this location does not have.”


Gonzales said he was uncertain why the previous location left the market nearly 20 years ago, but it may have been due to the migration of businesses away from Texoma Parkway to be closer to Hwy. 75.


Steele said the city does not anticipate offering any form of incentives for the new restaurant. He added that Denny’s returning to Sherman was a good deal for the city as it filled an otherwise vacant building with a tax-generating business and added a restaurant that providers 24-hour service.


Gonzales said an opening date has yet to be set for the restaurant, but he anticipated that it would open its doors in September or October of this year.


Michael Hutchins is the local government reporter for the Herald Democrat. Contact him at mhutchins@heralddemocrat.com or @mhutchinsHD on Twitter.