Potbelly may be booted from West Loop HQ

Restaurant franchise allegedly owes $800K in unpaid rent at JPMorgan’s 111 N. Canal Street

Chicago /
Nov.November 16, 2020 12:30 PM
111 N. Canal St. (Google Maps)

111 N. Canal St. (Google Maps)

Potbelly Sandwich Shop is facing eviction because of an alleged $800,000 in missed rental payments at its West Loop headquarters.

Its landlord at 111 N. Canal Street, a venture of JPMorgan Asset Management, has asked a Cook County judge to boot the restaurant chain from its offices after missing payments since April, Crain’s reported. The suit was originally filed in August, but Potbelly argued it should receive rent relief, as the company was unable to use the office space for the duration of the Covid-19 stay-home order.

Potbelly also claimed that JPMorgan had filed suit against them without first discussing a “reasonable and fair” compromise on the terms of their lease, which runs through February 2027.

The eatery, founded in Chicago in 1977, has more than 400 outposts across the U.S., along with more than 40 franchises. Like many other restaurants, Potbelly suffered as a result of the pandemic, and in August announced that it would shutter dozens of locations. Earlier this month, the company’s CEO Robert Wright stated in a company-wide meeting that talks with landlords to renegotiate 280 leases had been mostly successful.

Eric Kaplan, an attorney representing JPMorgan, told Crain’s that Potbelly has “expressed that they would like to downsize and we have made certain proposals, and they have told us that their rent will not be paid until there is an agreement on that, which is not acceptable.”

Potbelly signed the lease for the West Loop property in 2014, after developer Sterling Bay completed a major renovation of the building. JPMorgan purchased the building the following year for $304 million.

The company received a $10 million PPP loan; however, it saw a 30 percent year-over-year drop in sales in the third quarter.

Attorneys for Potbelly did not provide a comment.

[Crain’s] — Raji Pandya


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