The former Kid's Planet restaurant has changed hands. Whatever its future, the failed Mexican restaurant has left the city of Hesperia $340,000 in the hole.


The restaurant, located at 15075 Main Street, opened in December 2008 with the help of a $340,000 loan from the Hesperia Redevelopment Agency. Gov. Jerry Brown pulled the plug on redevelopment agencies earlier this year, and the note passed to the city of Hesperia. But the city won't get its money back, as it was third in line behind Arrowhead Central Credit Union and the U.S. Small Business Administration for debt collection on the property.


"Unfortunately, the property did not sell for an amount that covered both the outstanding loan and the (gap financing) owed to the redevelopment agency and its successor," city spokeswoman Kelly Malloy said Wednesday.


It could be worse: The SBA had to eat an $800,000 loss, according to Nick DiCosola, Senior Vice President for BradCo, who represented Arrowhead Central Credit Union in the sale.


Private investors, represented by Paul Suh of Vista Realty, purchased the property for $750,000 in February. The property had gone up for auction at $1.6 million in October 2011, but found no buyers at that price.


"While this situation is unfortunate," Malloy said, "we've had so many recent (redevelopment) success stories, especially with restaurants in Hesperia, that the loss on this has been balanced by the successes of Sizzler, Golden Corral, Wood Grill Buffet. ... Those are businesses that were able to relocate here because of the redevelopment agency. So, with those successes unfortunately come some situations like Kid's Planet."


During its 20-year existence, less than 1 percent of loans issued by the Hesperia Redevelopment Agency resulted in losses, according to Malloy.


Beau Yarbrough may be reached at (760) 956-7108 or at beau@HesperiaStar.com. Follow us on Facebook at Facebook.com/Hesperia.Star.