Byline: Joe Mosley The Register-Guard

Downtown Eugene's Palace Bakery, the longtime sister business of neighboring Cafe Zenon, has changed families.

Full City Coffee Roasters owner Michael Phinney purchased the bakery business last week from Zenon owner Brian James. The terms

The Palace closed on July 31 but reopened Monday, serving its own retail customers and supplying the pastry needs of Full City's next-door location at 842 Pearl St., and its shop at 295 E. 13th St.

"Primarily, we'll supply ourselves," Full City wholesale manager Lisa Truelove said. "Our plan is to kind of marry our (coffee shop) bakery into Palace's bakery. We'll keep some of our recipes and use some of their recipes."

The Palace Bakery will maintain most of its wholesale accounts, but because of its change in product focus it will no longer be supplying baked goods to Cafe Zenon. "That's something that Michael and I will negotiate in the future," Zenon owner Brian James said. "If he gets back into the breads and fine pastries, we'll certainly be talking to him."

For now, Cafe Zenon will get its pastries from Sweet Life Patisserie and its breads from the Hideaway and Metropol bakeries.

James said he decided to sell the bakery because Mandy Tomson, with whom he bought both Cafe Zenon and Palace Bakery two years ago, is no longer involved in the businesses.

"I just wanted to focus on the restaurant," James said. "I'm doing this by myself, and it's a little much for me to handle both businesses. So it's really about just being able to focus on Cafe Zenon."

Phinney was unavailable on Monday, but Truelove said the purchase was made because Full City had run out of room for its two existing full-time bakers to operate at the company's roasting facility, at 3850 Janisse St. in Eugene.

"We have simply outgrown that space, which is part of the reason we bought this space," Truelove said.

While the Palace Bakery location was open and baked goods were being sold on Monday, the kitchen space was still being cleaned up and the bakers were operating at the roasting facility, she said.

Palace Bakery operated with a staff of 17 before the sale; five employees were working Monday in the limited operation. Truelove said the bakery will start by producing primarily top-selling items such as pumpkin cookies, currant scones, shortbread and bran muffins, so long-term staffing levels won't be known until production picks up and expands.

There have been discussions about opening a wall between Full City Roasters and Palace Bakery, she said, but the plan for now is to get the bakery in operation and rebuild business.

"We want to kind of bring the original Palace back," Truelove said. "We will have less bread, the same core pastries that are the big sellers, and of course our coffee."

Full City has arranged to have David Korte - one of the bakery's three co-founders and its former manager - do some contract work until the business gets up to speed, she said.

Korte, along with David Counter and Bill Hatch, sold Cafe Zenon and Palace Bakery two years ago to James and Tomson. The three partners founded Palace Bakery in 1992 - about seven years after the restaurant got its start.