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/ March 4, 2013
Liquor Store On Superblock Forced To Close, NYU Insists Unrelated To 2031

Though LaGuardia Place’s Washington Square Wines and Liquors will close in a few days, NYU maintains that the disappearance of the store is unrelated to the 2031 Plan. The store’s manager blames its departure on NYU’s demolition clause and promise to double the rent, but NYU insists that it is, by New York standards, a forgiving landlord.

The demolition clause that manager Clift Arden recalled is perhaps the most intimidating part of the proposed lease. It allows NYU, if it so desires, to close any business within six months.

“They’ve kept it so that we can’t sell the store by not allowing any compromise for the new people. If the block isn’t going to be touched for ten years or more, why put it in the lease now?”

Philip Lentz, Director of Public Affairs at NYU, has an answer. “The demolition clause is very common in all NYU rent retail leases, as well as most rent retail leases in New York City.”

The store was hoping to sell its inventory and license to a new buyer, and is frustrated that three prospects suddenly fled. Arden believes that this is because they got a handle on the new lease, and realized what was in store for them.

Though NYU does not deny that it would double the rent in the next lease, Lentz pointed out that this is only because the University has maintained the rent for the store over the last six years. It has not applied “the regular escalation clause.” Knowing that the store would not be able to pay an escalating rent – as it wasn’t paying the rent it already had – NYU began to lease on a month-to-month basis. If NYU had insisted on escalating the rent, it would be about double of what it was in 2007, when the lease was last negotiated.

Though the store does owe backrent – about $111,000 of it – Arden explained that this is because it is subject, like most liquor stores, to weather. When outdoor cafes and beer sales pick up during the summer, liquor stores lose (and under New York State Law, are prohibited from selling beer). Wintertime is when they break even and begin to make a profit. Snow days—the delight of adults who rarely get time to drink during the week—boost sales. NYU’s February crackdown on the future lease does not account for the probability that the store will be able to pay up by winter’s end.

The store, now 40 years old, is feeling its age: Its warning to under-21s, “in effect since 1985,” also looks like it was printed then. The stock is empty (though this is probably because it is in its last days), and the employees move around slowly, as if what they do now has little influence.

Arden, though he does not profess to be entirely knowledgeable about the ins and outs of NYU’s policy, speaks as a local manager who, though he might not be technically suffering from the NYU 2031 plan, lives in fear of it. A commenter on The Villager article noted that, because NYU receives city land, it gains next to nothing, it is rare that the University suffers. And, when the 2031 Plan kicks in, it will receive more than it could possibly lose from charging the lower rent that would keep these stores in business.

Whereas the store faces a lose-lose situation, the University does not: Arden claims that it can write off the last rent collected, until it is back on the market and leased again. He defined the powers-that-be as reaching far beyond NYU and to the city itself, which, through commercial real estate law, “favors the landlords,” which in this case happens to be NYU.

“Any figure they want to ask, there’s nobody to stop it, nobody to talk to,” he said.

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