San Antonio Express-News (Sunday)
Station owner accuses 7-Eleven of fraud over lease
Back in 2019, Jamil Sayfi struck what seemed like a great deal with 7-Eleven to lease a convenience store and gas station his San Antonio company owns along Interstate 10 in Schertz.
Dallas-based 7-Eleven agreed to lease the property for at least $23,000 a month for 15 years, Bexar County land records show.
In addition, the company planned to spend $800,000 to renovate the property before occupying it.
But the retailer never followed through with its plans and in August informed Sayfi it was terminating the lease.
Now, in a lawsuit filed this month, Sayfi’s NAJDS Property Investments Inc. says 7-Eleven conspired with two Dallas firms “to commit fraud” by “purposefully” delaying the renovation project so one of the firms could buy the property at a discount to its market value.
NAJDS is seeking more than $1 million in damages from 7-Eleven Inc., architectural and engineering firm Dimension Group, and real estate development firm Prudent Development. Dimension, which was hired as the design firm for the project, and Prudent share common ownership.
7-Eleven, Dimension and Prudent didn’t respond to multiple requests for comment.
They have yet to answer the complaint, filed in state District Court in San Antonio.
“7-Eleven promised to improve my property and pay me a fair market rent,” Sayfi said in a statement provided by his lawyers. “Instead, they attempted to force me to a place where I would have to give away my property in order to support my family.”
‘Squeezing the company’
County land records show he purchased the roughly 35-acre property at 13183 Interstate 10 East in 1994 and deeded it to NAJDS in 2007. It operated the convenience store and gas station under the name Alamo Travel Center, but Sayfi wanted a tenant to take over day-to-day operations.
Dimension was supposed to apply for the permits required for 7-Eleven’s renovation project. Indeed, the Texas Department of Licensing and Regulation’s website shows work was scheduled to start Nov. 2 of last year and be wrapped up by March 2.
But according to the suit, 7-Eleven and Dimension delayed work for over a year and a half before the retailer terminated the lease in August.
NAJDS alleges the delays were so Dimension, through Prudent, could attempt to purchase the property. In April and May of this year, the lawsuit says, Prudent made several offers to buy despite “the obvious conflict of interest between Dimension and Prudent.”
“So they were squeezing the company by not paying it rent and then offering to take the property off its hands for a nom
inal price,” said James Rosenblatt, a San Antonio attorney representing NAJDS. 7-Eleven wasn’t required to pay rent until the renovation was completed, and he acknowledged it had the right to terminate the lease.
Rosenblatt declined to say how much Prudent offered for the property, only that it was “substantially less” than its value. Bexar Appraisal District records show the property has an assessed value of about $3.8 million.
Elena Serna, another attorney for NAJDS, says a Prudent official had worked in 7-Eleven’s real estate department at the time the lease was negotiated.
Fuel supplier pullout
Matters worsened for NAJDS in April 2020 when SEI Fuels, a 7-Eleven subsidiary, sent notice that it was terminating the San Antonio company’s right to sell SEI-branded fuel, according to the lawsuit.
SEI also declined to sell unbranded unleaded gas and diesel fuel to NAJDS, the complaint
adds.
SEI Fuels, which also is named as a defendant, attributed the termination to NAJDS’s performance in some “Mystery Motorist Program” evaluations. SEI also began withholding credit card payments to NAJDS, the suit says.
Ultimately, NAJDS closed the convenience store and gas station to allow the renovations to go forward, Rosenblatt said.
“It’s created an incredible hardship,” he said. “It was the most significant income-producing property that they had to where the property is no longer producing income. And so the company is struggling to pay its bills.”
Sayfi is now trying to find another party to lease the property, Rosenblatt said.
NAJDS’s claims include breach of contract against 7-Eleven, tortuous interference against Dimension and Prudent, and conspiracy against all of the defendants.