Thomas Breen photo
The closed downtown Subway, on the hook for $62K+.
A shuttered Subway sandwich shop’s owner has agreed to pay its downtown landlord over $62,000 in back rent and attorney’s fees and to move out by the end of July if it can’t find a replacement commercial tenant.
Malley Properties and Subway Real Estate LLC agreed to that stipulation this week to bring to an end a months-long commercial eviction case centered on the vacant, 1,214 square-foot groundfloor storefront at 926 Chapel St.
On Tuesday, state Superior Court Judge Claudia Baio formally approved the stipulation submitted by plaintiff’s attorney Robert Sensale and defendant’s attorney Aimee Loinig in advance of a scheduled eviction court hearing in the case slated for Wednesday.
The agreements marks the end — for now — of a case in which the owners of the the two-story Art Moderne commercial building at the corner of Temple and Chapel Streets downtown sought to evict the sandwich shop tenant that had occupied the space for two decades.
The terms of the stipulation agreed to by both sides show just how deep into rental debt the national franchise sandwich shop had become at this downtown location. The agreement also offers a glimpse into the hard financial times for groundfloor retail downtown, before and during the pandemic.
The agreement states that Subway will pay Malley Properties $55,662.79 in back rent on or before May 24. It will also pay the landlord $7,000 to cover attorney’s fees and costs by that same date.
The defendant will be allowed to keep all of the Subway-branded equipment and decor in the store through the pendency of the stay of execution, which last through the end of July.
If the landlord finds a new tenant for that downtown space, it must give Subway 20 business days written notice, after which the defendant will have to remove all personal property, equipment, and trade dress, and leave the space in accordance with the terms of the lease.
If the defendant finds a new subtenant for the location, then it must give the landlord 20 business days written notice and “rent shall recommence upon the Subtenant/Franchisee signing the requirement paperwork with Tenant/Subway.” The landlord also agreed to reinstate Subway as a “tenant in good standing” if it found a new subtenant and if it followed the other terms of the stipulation.
If Subway isn’t able to find a subtenant by June 30, then it will have to move all of its property out of the downtown space by July 31.
“If the Defendant fully complies with the conditions of this Stipulation, the Defendant may file a Motion to Open Judgment to which the Plaintiff will not object. Upon the filing of such Motion, the Plaintiff agreed to withdraw this action,” the stipulation reads.
“If the Defendant fails to make the agreed upon payments or abide by the above conditions, the Plaintiff may file an Execution for Possession without an additional hearing.”