No Big Surprise: Diego Closes After Less Than A Year On Smith Street

It probably won't come as a surprise to many in the neighborhood, but Diego, the Mexican restaurant at 305 Smith Street at the corner of Union Street, has already called it quits.  The eatery never really took off and seemed empty on most nights.
Before Diego opened, its owner, James Geritano, who also owns Bagels By The Park, created some controversy when he claimed that Dos Caminos's Executive chef Ivy Stark was involved in designing the restaurant's menu, a claim that was later denied by Stark's PR people.
With or without the involvement of a top chef, one has to wonder why all three restaurants that have opened in that space in the last few years (Sonny's, Union Smith Cafe and now Diego's) have failed, despite such a great corner location.
Perhaps, this Yelp review from October '11 gives a bit of an insight for why Diego won't be missed by many:
A few friends and I ended up here on a Sunday when trying to find a brunch place that would seat us right away. Awful awful service and mediocre overpriced food.  The waiter was extremely rude after my friend made a complaint about our food taking over an hour to arrive even though it wasn't at all crowded.  Then, when the bill came, turns out we were overcharged for a couple of plates. He basically said too bad, that's the price on their system, even though the menu had different prices.  He ended up telling us to "just pay the bill and leave." Who does that??

What about it?  Do you think Diego will leave a big hole on Smith Street?  What kind of eatery would do well at that corner?