Mystery Toronto group interested in Sarcoa site
Restaurant owner says group would pay Sarcoa’s rent for six months; future of site remains open
FORMER MAYOR Larry Di Ianni is working behind the scenes on behalf of Toronto investors to try to solve the messy legal battle over the harbourfront restaurant Sarcoa.
Di Ianni, who runs a consulting firm and is registered as a lobbyist with the City of Hamilton, is keeping the name of the group confidential.
But he’s put forward a proposal to the Hamilton Waterfront Trust that offers “suggestions and very tangible kinds of solutions.”
“I’m not at liberty to give chapter and verse because people who might be interested in becoming part of the solution have not given me permission to talk about it publicly, but also because the proposal is still out there for people to take up, at least in the next little while if people are interested.”
The Waterfront Trust, already locked in an ugly $15-million legal battle with the owners of Sarcoa, recently terminated the restaurant’s 10-year sublease for allegedly breaching conditions and not paying rent.
Sarcoa co-owner Sam Destro denies the allegations but corroborates that discussions involving a Toronto group have taken place.
According to Destro, the group proposes to pay Sarcoa’s monthly rent of $35,000 in advance for six months in exchange for the right to discuss future development at the restaurant site on the
northwest corner of Pier 8, formerly known as the Discovery Centre.
Destro says under that scenario Sarcoa would remain open and continue to operate under the same owners.
Werner Plessl, executive director of the trust, confirms the trust received a proposal behind closed doors at its July 11 board meeting but declines to reveal details.
“It hasn’t been completed yet,” Plessl said, noting the unsolicited proposal will be dealt with at the next regular board meeting on Sept. 12.
It’s not clear what the Toronto group’s ultimate interest is, but presumably it’s drawn to the prospect of acquiring the sublease to pursue opportunities of its own.
Destro says he’s “stunned” that the trust went ahead with terminating Sarcoa’s lease even though it knew a potentially gamechanging proposal by a third party was on the table.
“If the Waterfront Trust was truly interested in solving this and not causing panic and chaos (from cancelled events at Sarcoa), there was a way out. But they chose a different route.”
Destro denies the trust’s allegations of unpaid rent. Destro says he and co-owner Marco Faiazza have not missed a payment since Nov. 15, 2015, when a Hamilton judge ordered Sarcoa to resume its stopped payments while issuing a temporary injunction preventing the trust from seizing its goods and chattels.
Destro contends the bulk of the $226,000 the trust now claims as unpaid rent is actually arrears protected by the injunction, which Sarcoa has been paying off at the court-ordered rate of $3,000 per month.
Destro admits Sarcoa “poked the bear” by consistently delaying payments of its regular monthly rent for a few days to demonstrate “frustration.”
But he says before the trust moved to terminate the lease, Sarcoa offered to pay the June and accelerated rent for the next few months.
“I think the citizens of Hamilton, the councillors, the mayor all have to scratch their head and say what’s going on here,” Destro said.
The increasingly bitter squabble stems from a dispute over a bylaw banning outdoor music, which Sarcoa claims was killing its patio-party business. The owners insist their lease gives them the right to play amplified music. The trust denies it.
Di Ianni says when he first got involved he quickly discovered noise violations was the tip of an iceberg which now includes broken relationships and a lack of trust on all sides, complicated by the fact the city actually owns the property, which it leases to the trust, which in turn subleases it to Sarcoa.
“I’ve tried to cut through it, put aside feelings and relationships and just put forward some proposals that might have been interesting for people to look at,” Di Ianni said.
Given all this corroding turmoil, let’s hope the trust’s board members rise to the occasion. Instead of waiting for September to deal with Di Ianni’s proposal, why not call a special meeting and review it sooner rather than later?
Former Hamilton mayor Larry Di Ianni
Waterfront Trust shut Sarcoa down over an allegation of unpaid rent; the owner denies that.