The coronavirus pandemic has been a frustrating time for gym operators nationwide. So frustrating, in fact, that Brooklyn Boulders now wants out a big lease it signed last year.
The rock-climbing gym is suing its landlord to get out of a 30,598-square-foot lease across three floors at the base of 56 North 9th Street, a 45-unit rental building in Williamsburg. The property was built by Jay and Michael Weitzman in 2018.
On a conference call Friday, the tenant informed the landlord that it was terminating the lease “pursuant to the legal doctrine of frustration of purpose.” Under New York law, the federal suit notes, frustration of purpose refers to when an unforeseen event destroys the underlying reasons for performing a contract.
The Weitzmans rejected the termination and said they would see Brooklyn Boulders in court.
The climbing business’ complaint, filed Wednesday in the Eastern District of New York, states that executive orders by Gov. Andrew Cuomo in response to the coronavirus pandemic “completely frustrated the very purpose of the lease and made it impossible for [Brooklyn Boulders] to perform.” It seeks a declaration that its termination of the lease was lawful.
The retail lease was the third-largest inked in Brooklyn last year. Cushman & Wakefield’s Diana Boutross, Ian Lerner and Abie Dweck represented the landlord in the deal. Base rent for the first year of the lease term was $1,957,500, according to the suit.
The landlord declined to comment. Brooklyn Boulders did not respond to a request for comment.
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When the Williamsburg lease was first reported last February, the venue — which was to include art, co-working and events in addition to rock-climbing — was expected to open later in 2019. Details from the lawsuit allege why that did not happen.
When the landlord first tendered delivery of the space in June, the suit says, it was plagued with issues — “water in the basement, electrical service being incomplete, and the elevator stopped approximately six inches short from the third floor.”
The landlord pledged to fix them immediately, but the elevator was not corrected until March 19, 2020, the electrical work was not done and the mezzanine floor was not constructed as agreed, the lawsuit claims. Then the coronavirus happened.
The pandemic has prevented Boulders from continuing construction and operating its business in the space, something its owners say was “completely outside of [our] control and was not foreseeable or anticipated” when the lease was signed.
Additionally, the operator says, the Williamsburg location was not going to be a typical rock-climbing gym with relatively abundant space and unstructured activity, but a boutique BKBX location based on a niche business model.
That model depends on “the ability to convene classes where people are densely packed” and the appeal of “tight co-mingling with like-minded individuals” and therefore is not economically viable under social-distancing guidelines, the suit says.
The company’s “specialized business plan is completely destroyed under the anticipated continued governmental requirement of social distancing,” it argues.