Chris Wolfgang
Audio By Carbonatix
Lower Greenville Avenue became a hub in the mid-1920s, when it was the main thoroughfare to reach points north before Highway 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 Exceptional Cocktail Program, striking a balance between the drinks and the seasonal tasting menu. In 2025, it was named a semifinalist for Outstanding Bar by the James Beard Foundation. The tasting menu was regularly heralded as one of the best in the city. Yet despite these accolades, in January the owners announced that Rye would close in early March. The space will now become a second room for Apothecary, its sister bar next door.
Why is such a celebrated restaurant shutting 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 Greenville businesses since 2011. “Had Rye been able to go later, maybe we wouldn’t be having 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 association and even hired a consultant to help navigate 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 commissioner made it clear at the time that they could revisit the late-night SUP once the issues 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 delineate 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 reapplied in 2024. Although city staff recommended approval, neighborhood pushback led council members to state they would oppose the late-night permit. Council 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 applying for two years,’” Agar says.
They did not seek a permit in 2025 because Agar and his partners were focused on opening Flamant in Plano. But the plan, going into 2026, is to start the process again so Apothecary, which is classified as a restaurant by the Texas Alcoholic Beverage Commission, could stay open until 2 a.m.
Agar is unsure why his businesses have gotten so much pushback from the neighborhood. “I would think that a soundproof room, where everyone is seated, and the police 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 Doughnut 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 administration’s tariffs affecting food costs, and while Agar doesn’t entirely attribute the rising costs to the tariffs, he notes that the restaurant’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 Hospitality, only open restaurants at properties they own. Agar says he and his partner Taylor 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 restaurants 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, hoping to attract more customers. They also expected 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 going, 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 busiest month, were not enough to keep it open.
Surcharge-Gate
Then there were those who didn’t like the restaurant’s politics. In 2023, Rye introduced a 3% optional surcharge on checks to fund employee health insurance and benefits. For Agar, it was an exercise in transparency. He wanted customers to know what they were paying for, rather than raising menu prices and passing along costs. The resistance, from people who had eaten there and many who hadn’t, was loud. It continued to the bitter end. One of the first responses 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 neighborhood 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 northern suburbs of Dallas, they have less reason to come to the city to visit restaurants.
Rye closed on March 7. This Friday, March 13, the team will unveil the new remodeled Apothecary space.
