Restaurants Fear Going From “Closed” to “Space for Lease” By July

Restaurants Fear Going From “Closed” to “Space for Lease” By July
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Chefs and restaurateurs are relying increasingly on the kindness of landlords as gaps in the government stimulus plan become more obvious.

Caffe Dante West Village was supposed to be one of New York’s major spring 2020 openings. It was an outpost of Dante, the Greenwich Village hangout that had been crowned the Best Bar in the World in 2019 by the Tales of the Cocktail Foundation. Its owner, Linden Pride, had spent 18 months and more than $1.6 million building the 74-seat restaurant in anticipation of welcoming its first paying guests on March 16.

But when Andrew Cuomo requested density control measures on March 15, Pride realized a formal opening was out of the question. He immediately sent an email to his landlord, William Gottlieb Real Estate, asking to negotiate the terms of his rent.

Simply put, he didn’t have enough money to pay it—for March or April. “We put everything of our savings into the buildout of the new restaurant,” Pride says. “We got to the starting line with enough money in the bank to pay the first week’s payroll and suppliers.”

Worse, he says, the new restaurant doesn’t qualify for stimulus money from the federal government’s $2 trillion package, because it has no history of payroll.

After some back-and-forth between Pride and Gottlieb representatives, on April 7 the landlord served a notice of default. If Pride doesn’t pay past-due rent and fees by April 14 (the technical term is “curing the default”), the landlord can initiate legal action. In a worst-case scenario, once the 90-day moratorium on evictions lifts in mid-June, Pride’s new restaurant could close before it ever opens. “If I don’t ‘cure’ this, they can come after me personally,” Pride says. “I’ve just spent all this money on the space, which they could take back in possession, and our money would be down the drain.”

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