In the wake of the COVID-19 pandemic, fashion company Valentino has sued its landlord for closure of its flagship Manhattan location in New York City’s 5th Avenue.
Photo Credit: Shutterstock
On Sunday, Valentino filed a lawsuit against landlord Savitt Partners in the state of New York’s Supreme Court to end its lease on the four-story 5th Avenue location it currently rents. The company claims it is impossible to do business at this store with COVID-19 restrictions. Valentino currently has a 15-year lease on the space that started in 2013.
In the filing presented to the courts, Valentino used the literature of the lease agreement, which stated, “The tenant can solely and exclusively use the unit for displaying and sales of luxury items.” Valentino then pointed out that under the primary agreement, both parties clearly understood that the building’s prime retail location on 5th Avenue serves as a focal point of high-end New York City fashion buyers. This factor was justification for the corresponding substantial rent paid.
With a lack of consumer confidence and increased fears of COVID-19 cases, Valentino’s designation as a “non-essential” business has been substantially hindering. It has been rendered impractical, unfeasible and no longer affordable to keep this location by the company. “Even in a post-pandemic New York City (should such a day arrive), the social and economic landscapes have been radically altered,” the company said in the complaint, adding that the ability to maintain sales in the store has been “drastically, if not irreparably, hindered.”
Retailers and big box stores across the United States have been struggling with the impacts of the coronavirus pandemic. Businesses have been closed months as retailers have been renegotiating rents, requesting extensions, delays or delinquencies on payments. Some companies have purposely refused to pay. The economic impact has also been felt in other high end retail chains across the industry, including Barneys and Victoria’s Secret. The case will surely be a precedent for future COVID-19 oriented tenant-landlord lawsuits.
For more stories from Haute Lawyer, please visit www.hauteliving.com/hautelawyer.com
Reference: https://commercialobserver.com/2020/06/valentino-suing-landlord-to-get-out-of-fifth-avenue-lease/
