The owner of the Four Seasons hotel at 57 East 57th Street is suing tenant Zilli USA for $ 2.7 million in arrears.
Ty Warner Hotels and Resorts alleged in a complaint filed this week that the U.S. subsidiary of the French luxury fashion company skipped rent on its lease for part of the property’s ground floor.
Zilli signed the lease in 2009, but the agreement has since been amended several times. As of 2019, the tenant was expected to pay $ 1.4 million per year, an amount which the complaint claims is expected to increase in subsequent years. Zilli also agreed to pay a percentage of property taxes for the locals.
However, in April 2020, Zilli did not pay rent and property taxes. The landlord gave a notice of default on August 24, 2021.
Neither Warner nor Zilli responded to requests for comment.
Ty Warner, the hotel company’s eponymous owner, is the Chicago billionaire behind Beanie Babies, the iconic plush toy brand. He bought the 57th Street hotel in 1999 for $ 275 million.
In recent years, Warner has twice almost sold the hotel. Although he has received offers of around $ 900 million in the past 12 years, he has pulled out of potential deals, the The Wall Street Journal previously reported.
The 57th Street location is the exclusive property of the Four Seasons brand in the city. Warner also has hotels in Mexico and California, including a Four Seasons hotel in Montecito.
Rent disputes have become increasingly common amid the pandemic, which has closed shops and forced hotels to collapse. Some of the early cases saw judgments passed earlier this year, and as they began to be resolved, they potentially paved the way for other bickering landlords and tenants.
A judge ruled last spring that Philippe Chow, a luxury restaurant in the Dream Hotel Downtown in Manhattan, owed its owner rent, despite being closed amid the pandemic.
“Under the lease, the plaintiff must make a choice: stay and pay rent or terminate and leave,” Judge Melissa Crane wrote in her decision.