Century City stalwart Gelson’s is battling to have Mario Batali’s fashionable gourmet food emporium Eataly booted from Century City mall before it even opens, The Real Deal has learned.
The grocery company is suing retail giant Westfield, its landlord, claiming that Eataly’s entry into the mall violates Gelson’s lease agreement, which it says gives it exclusive rights to operate a grocery store at the location.
Under the terms of the agreement, Westfield cannot ink a deal with a “competing business,” it says.
Gelson’s even alleges that Westfield tried to force it to stand down over Eataly’s lease by withholding approvals for a renovation to Gelson’s own store, which would have included installing a new Tapas bar.
A spokesperson for Westfield declined to comment, citing pending litigation.
Gelson’s, which has had a location at the mall since 1967, is one of an old guard of tenants still in place at the property, which is currently undergoing a massive renovation. Westfield is reportedly spending a whopping $800 million to makeover the mall, which it bought in 2002, and has recently inked deals with new high-profile tenants such as Nordstrom.
The deal with Eataly, which was announced in 2014, would mark the brand’s first foray into the L.A. market after launching its first New York location in 2010.
Gelson’s said Westfield is trying to get around the exclusive lease agreement by claiming that Eataly is actually first and foremost a restaurant as opposed to a grocery store. But Gelson’s cited numbers publicly stated by Batali, who allegedly said the grocery element of Eataly’s emporiums accounts for more than 50 percent of the company’s business.
Gelson’s took legal action against Eataly this week after the company declined to provide financial documents that would spell out its revenue based on grocery sales.
A spokesperson for Eataly was not immediately available for comment.