Hartz confident it will prevail in trial with Harmon Cove tenant
While Vitamin World's legal fight to get its recently demolished Harmon Cove Outlet Center location restored has been granted a trial, an executive at the firm that owns the property is confident the retailer won't win the case.
"Any rational retailer wouldn't want to remain in that mall, so for what reason, other than extortion, would they want to go to court?" said Gus Milano, executive vice president for finance and leasing at Hartz Mountain Industries. "Clearly, the judge is not going to require us to reopen a mall where there are no tenants, and I think the judge will realize this is just extortion and what they're asking is unreasonable."
According to Milano, Hartz Mountain converted the former industrial property to an approximately 150,000-square-foot shopping center 25 years ago. While the property once held 40 retail tenants at peak occupancy, Milano said only 10 percent of the mall was occupied as of Sept. 1, noting "sales have been eroding over the last few years, and tenants were coming to us to get out of their leases."
"Even if there were a few thousand square feet of tenants still in the mall, we're talking about a situation where we couldn't even pay a retailer to move back in there," Milano said. "We offered to relocate Vitamin World at our expense, with no additional lease terms or rent, to clearly much better retail locations than one that has become obsolete — and those offers are still on the table."
But Loryn P. Riggiola, an attorney at Newark-based Sills, Cummis & Gross P.C. who is representing Vitamin World, said, "Given the way the landlords have acted, entering into another lease with them may not be the best business decision."
"Hartz made it so Vitamin World didn't know it would get kicked out of the mall, and then in the very interim, they started to demolish the building and did whatever they could do to make sure it would be too expensive to put the building back into a habitable state," Riggiola said. "The Appellate Division has made it clear a potential remedy for us is to force them to repair the building and provide re-entry, given their egregious conduct, and that's a remedy we're going to pursue."
But Milano said "even if judge rules that they can move back in, they wouldn't do it, because no one would."
"It's preposterous to believe they want to move back into a vacant mall," Milano said. "If they do succeed in the case, I would say, 'Be careful what you wish for,' because I don't think anyone would go into an empty mall to visit a 900-square-foot store."
On Nov. 14, Vitamin World was granted an extension on the original stay from Hudson County Superior Court that will stop demolition work on the property indefinitely. The case has been remanded to a trial court, though a date has not yet been set.