Charles Cohen Sues Saks for $1.9M in Rent at Manhattan Building
By Lois Weiss September 1, 2020 7:58 pmreprints
Developer and landlord Charles Cohen is suing Saks & Company LLC for what he claims is $1.9 million in skipped rent for space for its Saks OFF 5th division at Cohen’s luxury mixed-use tower at 135 East 57th Street in Midtown Manhattan.
OFF 5th signed a lease on Nov. 1, 2015 for around 56,000 square feet that was touted in real estate media, with Cohen telling the New York Post the lease was “a game-changer for 57th Street retail east of Park Avenue.”
The lawsuit filed July 10 in New York Supreme Court cites the 15-year lease that includes a ground-floor entry, plus two entire lower levels, and runs through Jan. 31, 2032. OFF 5th also has a renewal option.
According to court documents, the minimum rent is $5.3 million per month for the first five years, rises to $5.7 million for the next five, and to $6.1 million for the final five-year period.
Saks still has open lawsuits from 2018 for apparently skipping rent to other landlords. Its Southlake Mall location in Merrillville, Ind., owes more than $354,400. The same plaintiff owner is suing Saks for $439,788 for a location in Matteson, Ill., and in North Riverside, Ill., for $102,655, and at the Stratford Square Shopping Center in Bloomingdale, Ill.
In the Cohen case at 135 East 57th, the lawsuit alleges Saks didn’t pay either its minimum rent of $441,666 or additional rent starting in April 2020. Nor did it pay required fees for fire safety, water, condenser water, state taxes and security guards, the lawsuit claims. A rent concession within the lease of $29,110 has been duly subtracted each month since March 2020, but that concession ends in February 2022.
Due to pandemic-related delays in receiving the complaint, Saks’ attorneys at Loeb & Loeb requested additional time to respond to Cohen’s suit but his attorneys at Harwood Reiff rebuffed the retailer. In a motion that will be heard on Sept. 9, Loeb & Loeb filed an additional lawsuit and motion to gain that extra time.
Cohen is known for being a tough landlord. In 2010, Daffy’s, a retailer that had occupied the exact same space as Off 5th for 15 years, missed sending a renewal notice by four days. Cohen immediately sued to boot Daffy’s from its then under-market deal but both the lower and appellate courts ruled in Daffy’s favor.
No matter: Daffy’s itself liquidated in 2012, and the mostly underground space remained empty until Cohen leased it to OFF 5th in 2015 for more than twice the rent.
Calls for comment to the attorneys were not immediately returned. Saks OFF 5th sent this comment following this article’s publication: “We are working with our landlord partners across North America to amicably and logically share the losses incurred during this ongoing pandemic. We believe that there are fair solutions to be had as we recover from this public health crisis. In this instance, we are eager to reach a fair resolution, just as we have done with other landlord partners.”