Landlords sue to collect rent from Bed Bath & Beyond, Union Standard restaurant
At one time the Union Standard restaurant was hailed as a major step in the transformation of the historic Union Trust Building Downtown. Now it is being sued for back rent and for closing for good during the COVID-19 pandemic.
The Davis Companies, the landlord, has filed a complaint in Allegheny County Common Pleas Court seeking to collect at least $72,045 in back rent and other damages after the restaurant shut down in early June.
It’s not the only Common Pleas Court lawsuit that has been filed this week against a retailer or restaurant for not paying rent during the pandemic.
Waterworks Phase II, the landlord of the Waterworks Mall in Lincoln-Lemington near Aspinwall, is suing Bed Bath & Beyond to collect $81,338 in rent payments and late charges dating back to April and May.
Each case represents a microcosm of the broader businessrelated issues facing tenants and their landlords as they deal with revenue losses caused by pandemic-related shutdowns and stay-at-home orders. In many cases, there’s tension between tenants seeking rent relief as losses mount and landlords who rely on those revenue streams to pay mortgages and other bills.
The lawsuit against the Union Standard is the second The Davis Companies has filed over a failed restaurant venture in the Union Trust Building, a Grant Street landmark built by industrialist Henry Clay Frick.
In May, it sued Del Frisco’s Restaurant Group and Landry’s LLC after they backed out of a deal to open an upscale steakhouse at the location.
The closings have left two of the building’s prime street-level retail spots vacant after The Davis Companies spent $100 million restoring and renovating the building, which opened in 1917.
In the lawsuit against the Union Standard, The Davis Companies contended the restaurant
failed to make rent payments in April, May and June, even though it was open at least part of that time for takeout service.
Under state order, restaurants were forced to close for dine-in service in mid-March because of the pandemic, although they were allowed to offer takeout and delivery.
Starting May 29, the lawsuit stated, the Union Standard was permitted to reopen for sit-down dining. But instead of doing so, it informed The Davis Companies that “it intended to cease operations entirely and close permanently.”
According to the lawsuit, the lease did not permit the Union Standard to shut down.
The Davis Companies is suing the restaurant and owners Robert Glimcher, Chuck Hammel and Derek Stevens — who left his job as an executive chef to pursue his dream of running his own place — for breach of contract.
Jonathan Kamin, the attorney for the defendants, said there was no way for the restaurant to continue in business as a result of the pandemic.
“For years, Derek Stevens worked very hard to turn the Union Standard into a terrific restaurant and a terrific destination. Just with the pandemic and the restrictions associated with it and the current restrictions, there’s just no way to make the restaurant work,” Mr. Kamin said.
Allegheny County has ordered restaurants, bars and casinos to shut down again for the next week because of a dramatic spike in COVID-19 cases. Takeout and delivery are permitted.
Mr. Hammel, the president of Pitt Ohio, said it is nearly impossible for a restaurant to make money while operating at 50% capacity because of COVID19 restrictions. It’s difficult even at full capacity, he noted.
“How is any restaurant with an expensive lease and rent going to survive?” he asked. “It’s just a shame.”
Mr. Stevens declined to comment, as did Jonathan Davis, CEO and founder of The Davis Companies.
In the lawsuit against Bed Bath & Beyond, Waterworks Phase II claims that the failure to pay rent “constitutes a material breach of the underlying contractual agreement entered into between the parties.”
It also accused the retailer of being in default of its lease.
Bed Bath & Beyond was shut down for part of the spring because of the pandemic.
The lease contained a force majeure clause related to riot, wars, earthquakes, hurricanes, tornadoes or other events “beyond the reasonable control of the party.”
However, according to the lawsuit, part of the clause read, “Notwithstanding the foregoing provisions, the financial inability of a party to perform its obligations under this lease shall not constitute an event of force majeure.”
The lawsuit is seeking rent payments from April and May, as well as late charges for those two months and for June.
No representatives of Bed Bath & Beyond, Waterworks Phase II or J.J. Gumberg Co., the managing agent for the landlord, could be reached for comment Friday.