Developer Lands Exclusive Deal With California Pizza Kitchen.

Eager to be assured locations in future shopping centers built by hot-handed developer Rick Caruso, California Pizza Kitchen has taken the unusual step of granting Caruso exclusive franchise fights to build and operate CPK outlets in an area stretching from Malibu to Paso Robles.

Under the deal, Santa Monica-based Caruso Affiliated Holdings has formed a new company, C A H Restaurants LLC, which is planning to open and operate five CPK restaurants over the next three years. Construction has already begun on the first restaurant, which is slated to open in August at the Pacific View Mall, a preexisting center in Ventura.

Caruso is considering other CPK outlets for Malibu, Valencia, San Luis Obispo and Santa Maria.

"CPK will provide a great synergy for the real estate we have," Caruso said. "They have such a great trade name, which is difficult to duplicate. There wouldn't be another restaurant chain that I would be interested in."

Meanwhile, officials at Beverly Hills-based CPK seem equally enthusiastic about Caruso becoming a restaurant franchisee in addition to a developer.

"We need strong, capable partners to get broader penetration in all markets, and Caruso has demonstrated that ability with his projects," said Carey Carrington, CPK's executive vice president and chief financial officer. "He can help us identify suitable venues for new locations."

Indeed, Caruso has developed a string of tremendously successful retail project in recent years, including The Commons at Calabasas, Encino Marketplace and The Promenade at Westlake Village. He's currently developing a project in Thousand Oaks, complete with a lake that will be frozen in the winter for ice skating, as well as a major addition to the landmark Farmers Market at Third and Fairfax in Los Angeles.

Industry experts said it's very unusual for a chain to grant exclusive franchise rights to a developer with no restaurant experience.

"My sense is that it's pretty rare, almost unheard-of," said Bill Alexander, executive director of Franchising for Dallas-based Carlson Restaurants Worldwide Inc., parent of the T.G.I. Friday's chain. "We've had situations where we've partnered with those who aren't typical franchisees, but we require that they be a passive investor and we operate it."

By having Caruso on board, however, CPK can eliminate the headache of finding and building new locations, which can take two years and cost well into the six figures, according to Phyllis Ann Marshall, a restaurant consultant at FoodPower in Costa Mesa.

"Restaurants love for somebody to pave the way in real estate transactions," Marshall said. "And who's better suited than a developer who can understand and appreciate the restaurant business?"

The nuts and bolts of the partnership will give CPK approval rights for any new location that Caruso proposes. CPK would then receive a franchise fee and ongoing royalties generated from revenues.