By Sabina Mollot
The owners of the Associated Supermarket in Stuyvesant Town — who, as Town & Village reported last month — were losing faith they’d be given a lease renewal by CWCapital, finally got that elusive phone call from the landlord.
It just wasn’t the one they wanted.
The offer? Take three quarters of a million dollars to walk away before the lease even ends in two years, one source with knowledge of the situation told Town & Village. However, the store’s principal owner Joseph Falzon felt he could make more if he rode out the rest of the lease term.
Falzon had told Town & Village in September that he hadn’t gotten an answer about renewal for over a year with CW declining to talk business, while Falzon wanted to make sure the franchise had a future before investing in a much-needed renovation. Meanwhile, he said he was told a competing supermarket had offered CW double the rent he was paying, now around $60,000, only to be denied.
Reached on the phone last Thursday (prior to the property being sold), Falzon confirmed he’d gotten an offer to leave early and that he wasn’t interested in doing so.
“We plan to stay unless something drastic happens,” he said. “As far as we’re concerned we’re here until the end of the lease.”
A renovation won’t happen, though, since Falzon said “it wouldn’t pay” for only two more years at the location.
As for the company that’s been quietly expressing interest in the space, a consultant for it, T&V’s aforementioned anonymous source, said that finding out CW’s plans for it had been an exercise in futility.
“CWCapital’s opacity has become legendary,” he said, adding that his clients then were left to wonder if CW intended to simply raze the space and develop over it.
Of course this was prior to the big news that the property had been sold on Monday night. New owner Blackstone has said it did not intend to build over the property’s open spaces. A spokesperson this week told T&V this commitment not to redevelop also extended to existing structures.
As for the legality of such a move at a commercial space that’s part of a rent-stabilized property, real estate industry attorney Adam Leitman Bailey told Town & Village the owner, if so inclined, would be well within its rights to redevelop it.
“As long as they’re not removing services that are guaranteed to rent stabilized tenants they can build whatever they want,” said Bailey. “Tenants have a right to peaceful habitation and living. They cannot take any rights away from them.” But, he added, “A right is not to have access over a lot. The tenants have no jurisdiction over that.”
Meanwhile, Falzon told T&V this week that he has no idea what the switch in Stuy Town ownership means for his situation. “Before I was sure. Now I don’t know,” he said.
A spokesperson for Blackstone, reached on Wednesday, was traveling but said she would look into the matter.
A spokesperson for CWCapital has previously told Town & Village the company won’t comment on lease negotiations.
Meanwhile, the Associated supermarket, owned by principal owner Falzon and three other partners, has been located in Stuy Town, at 409 East 14th Street, east of First Avenue, for about a quarter century. The owners recently closed a Gramercy Met Foods supermarket on Third Avenue. While the supermarket industry has been struggling overall, Falzon previously said he hoped to remain in Stuyvesant Town, even though business isn’t what it used to be when there were fewer students and more families.