Everyone seems to want to live in St. Pete these days, but there are only so many expensive condos to go around.
With this in mind, property values are on the rise and potential parcels for development highly sought after.
One such parcel may be the Plaza Tower & Courtyard Shops and its adjacent strip mall on First Street in downtown St. Petersburg.
Kalyvas Group LLC bought the properties in 2002 for $17 million; they are sandwiched between Beach Drive and Bay Walk that includes the popular Sundial entertainment complex.
Located in the mall is Salon LaRu LLC, owned by Rudolph Andrews.
A few months before his current lease was due to expire, Andrews contacted his landlord — the Kalyvas Group — to inform them he wanted to exercise the first of two optional three-year renewals on his 600 sq. ft. salon.
However, when Andrews read the amended lease prepared for him by his landlord, he discovered a disturbing new clause: “In the event that Lessor (Kalyvas) elects to redevelop the Premises, this lease may be terminated upon 180 days prior written notice.”
As this new clause effectively makes Andrews’ lease worthless, he refused to sign it as is; he crossed out the amendment, signed it and returned the lease with his amendment and a check for the months rent.
The rent check and lease were soon returned with VOID written across it.
Holding firm, the Kalyvas informed Andrews that if he did not sign the new lease — with the development clause — his existing lease would expire on May 31, 2016, and that they would consider him to be a ‘holdover’ tenant and, as a consequence, would be subject to double his usual rent of approximately $1600.
Andrews has since filed suit seeking a court order to validate his original lease renewal sans the “redevelopment clause.”
We spoke to Lance Andrews, a semiretired attorney who is both a managing partner of Salon LaRu and husband of Rudolph Andrews.
“They’ve been jamming these clauses down peoples’ throats,” said Lance Andrews. “When we moved the business we were very specific we wanted a long-term lease as we wanted to develop our business and clientele. When we met with Bill (Kalyvas) to discuss it he spoke at length, I’d say he was pontificating, as to how they had been adding these clauses into all their leases as they added value to his properties.
“That’s great I said but it reduces the value of ours,” Andrews added.
Given the location of the salon and the rest of the property, suggestions of impending redevelopment are common.
“Speculation, I believe, is just that, speculation,” Andrews suggested, “In large part because of this lawsuit.”
He went on to add: “At one point Bill (Kalyvas) asked me to come up with a number he thought would be appropriate for the lease, but when I emailed some time later, his wife told me he had simply changed his mind and was no longer interested in any payout.”
Andrews is working alongside George Hayes of the Hayes Law Group, who is handling the case.
“I’m a bit perplexed as to how we got to this point,” said Bill Kalyvas. “We’ve been in the leasing business for a long time and our tenants are very valuable to us. All I would say is if this tenant has beef and wants to get it in the paper and see where it goes that’s up to him.
“What I would say is you may want to look at the source of this information,” he added. “I would suggest doing a criminal-background check on both of these people involved.
“That’s all I’m going to say.”