PetSmart could get the heave-ho from two Miami-Dade shopping centers for allegedly owing $62,269 in rent.
Berkowitz Development Group, through two related entities, filed a pair of eviction lawsuits against the national pet retailer in Miami-Dade Circuit Court last week.
The Coconut Grove-based commercial developer alleges PetSmart hasn’t paid $25,611 in rent for its big box store at Dadeland Station in Kendall, as well as missing $36,658 in rent payments for a big box space at Aventura Commons in Aventura. The plaintiffs in the two lawsuits are Aventura Commons Associates and Dadeland Station Associates.
Berkowitz founder and Chairman Jeff Berkowitz and Mark Auerbacher, the attorney for Aventura Commons and Dadeland Station, did not return phone and email messages seeking comment. A PetSmart spokesperson also did not respond to requests for comment.
According to Datex Property Solutions, a software company that tracks commercial rents, PetSmart had paid 80 percent of its rents nationally as of May 8. The lawsuits state PetSmart was sent late notices on May 6 and May 8 and did not respond.
During the early weeks of the coronavirus pandemic hitting the U.S., South Florida commercial landlords showed a willingness to offer tenants rent deferrals or work out arrangements. That sentiment continued through April as several major landlords such as Pebb Capital, Tricera Capital and Avra Jain disclosed they were giving rent abatements to tenants. Some experts recently said landlords were still collecting upwards of 90 percent of their rents from commercial tenants who had qualified for Covid-19 related stimulus aid.
Andrew Rossman, a partner with the law firm Quinn Emanuel who is not involved in either lawsuit, said Berkowitz is taking an aggressive stance at a time he is seeing commercial landlords trying to work things out with their tenants.
“I haven’t seen a lot of instances where landlords are seeking to evict tenants,” Rossman said. “It’s an interesting strategy. But what happens if [PetSmart] leaves? What replaces it? More often, landlords are trying to work it out or taking a wait and see attitude.”
Jason Kellogg, a partner with the law firm Levine Kellogg Lehman Schneider and Grossman, who is not involved in the suits, said it’s possible Berkowitz and PetSmart could not agree on a rent abatement or rent deferral.
“I would imagine the landlord and PetSmart have been talking since day one of [the pandemic-related shutdown] and it has taken this long for the landlord to realize it’s not something they can accept.”
Kellogg said some landlords are also using nonpayment of rent caused by the pandemic to rip up leases they no longer find favorable.
“They are using force majeure clauses to terminate agreements,” Kellogg said. “I think it is more likely this landlord believes the lease with PetSmart is below market and is using the pandemic to get out of it.”