UPDATE, June 21, 2019, 1:00 p.m.: A battle has broken out over the lease of a prominent flagship store off Fifth Avenue.
The landlords of the mixed-use building 15 West 55th Street, Salim “Solly” Assa and his partners, are trying to evict Domenico Vacca from the property’s commercial space, alleging that the Italian luxury retailer is in default of its $4 million-a-year rent.
But now, Vacca, who serves as the creative director of his eponymous line that is known for its mens suits worn by celebrities like Denzel Washington, is punching back. He filed a multi-million-dollar lawsuit in New York Supreme Court last week against Assa, his partners and associates. The case slings a slew of allegations, most prominently that such a high rent was only needed for Assa and his partners to lock down a $91 million mortgage on the building.
Assa did not return messages seeking comment. Luise Barrack, the attorney who is representing the landlord group, called the complaint, which she said has yet to be served, “fictitious and scurrilous” and that she plans to move to dismiss it.
The partnership started in 2014, when the two entered a joint venture to build what would be the brand’s location at Assa’s property, according to the lawsuit. The tenant company would be comprised of two entities, each with 50 percent ownership: one for Vacca’s group and the other controlled for Assa and his partners, according to the complaint. (Barrack, in an interview, denied that Assa is part of the joint venture that serves as the commercial space’s tenant.)
The goal for the 11,000-square foot space was to build a branded retail store that also had a salon, barber shop, cafe and club.
But it was that last bit that never came to fruition, when the store opened about three years ago to wide media attention. The complaint claims the club wasn’t able to secure a liquor license, as the property had numerous violations and complaints lodged against it, particularly over illegal short-term rentals that led Assa last year to fork over $1.2 million in a settlement with the government to resolve the issues.
Barrack said the city also did not want to give a license to Vacca for other reasons, including that the retailer was serving alcohol before it was allowed to. The New York Post reported in 2017 that the local community board rejected the venture’s application for the third time and pointed to its “reckless operation of the premises.”
The necessity of the license to support the space’s $333,000-a-month rent was something both parties understood, Vacca’s complaint says.
The complaint alleges that Assa knew the building would never be able to get the necessary license for the club because of these building violations, of which Vacca was allegedly unaware. In an email exchange with TRD, Vacca said he only learned of the complaints through the media, after he signed the lease.
However, Vacca’s store has never paid the full monthly amount of rent, according to the complaint. When it became clear the venture wouldn’t be able to get a liquor license, Vacca alleges that Assa and his partners agreed to reduce the rent to just 10 percent of the store’s proceeds — an amount that was later raised to just $30,000 a month, a far cry from the $4 million-a-year rent stated in the lease.
Barrack, the landlord’s attorney, in an interview said the lease calls for $4 million a year. “The rent was guaranteed by Domenico Vacca, who is an attorney, by the way,” she said.
Vacca noticed a shell company allegedly connected to Assa was funneling funds into the store’s bank account to make up the remaining rent the lease calls for, the complaint says, adding that this was done for alleged justification for the property’s lender, Barclays Bank, to give a $91 million mortgage in 2015 and to hide the source of the investment, the property’s landlord.
When asked how Vacca did not realize that his store’s bank account had additional funds, Vacca in an email said he was manager of the entity that owns the store until two years ago. “My title is creative director of the Domenico Vacca brand but no longer involved in operations,” he wrote.
Barrack said her client wants to evict Vacca because the store has not paid its full stated rent. “The written documents that exist don’t support [the allegations],” she said.
“They filed this summons and complaint in an effort or attempt to stay the landlord-tenant proceeding,” Barrack also said.
The complaint and landlord-tenant case aren’t the only legal matters pending with Vacca. One of his partners, Alex Blavatnik (the brother of energy billionaire Len Blavatnik) sued Vacca in New York Supreme Court in 2016 for allegedly fraudulently obtaining a $1 million loan from Blavatnik by providing Blavatnik with false financial information about Vacca’s retail business, among other allegations. Vacca has denied the claims.
UPDATE: On May 31, Vacca withdrew his complaint.