Business

Russell Street Deli presses on with planned closure despite offers for help


April 24, 2019, 7:24 AM by  Violet Ikonomova

Featured_img_0487_35528
Russell Street Deli staff, August 2018.

Local media outlets are reporting there's an effort underway to help Russell Street Deli — a fixture in Eastern Market — remain open as its landlord demands the business cover a costly repair it says it can't afford.

The Eastern Market Corporation is reportedly "exploring ways" to "bridge the gap" in the dispute, including possibly helping pay for the $50,000 floor repair landlord Sanford Nelson says is needed. And if not the non-profit development group, some have suggested the public can come to the rescue. Chad Livengood at Crain's tweeted yesterday that 10,000 attendees at the upcoming Flower Day could cover the cost of the repair by pitching in $5 each.

What the people who wish to help, as well-intentioned as they may be, seem to have failed to grasp is that this is about more than just money — or at least, it's about more than this particular sum of money.

Simply put, deli owner Ben Hall does not trust landlord Sanford Nelson (and he's not the only one in the neighborhood — perhaps you caught this banner hung during Murals in the Market last year).

Nelson's response to the floor issue was to offer to roll what he said would be a $50,000 repair into the deli's rent. Under that deal, the deli would pay $3,500 per month over several years — a more than 100 percent increase — or more than $6,000 per month over a shorter term. Hall, unsurprisingly, was not happy with that arrangement.

But Hall says what sent him over the edge was not the dispute over who should pay. Rather, it was what he calls Nelson's "rapacious" business tactics. Hall decided he would close in late September after he says Nelson unceremoniously shut down his business for a day — costing the deli thousands — and sent a steady stream of inspectors to survey the floor. Now, we don't know for certain who sent those inspectors — the Detroit buildings department and other agencies told Deadline Detroit and the deli they were operating on anonymous tips — but Hall says photos provided to one were identical to photos Nelson's team had taken of the damage and given him. Nelson's firm did not respond to comment on this point.

Nelson also tried to push Hall to file an insurance claim to cover the repair. And even though a city building inspection in early April determined there was no safety issue, and the two were at a stalemate over who should pay, Hall says Nelson pressed forward, making arrangements for the work to be completed.

Nelson — a young investor who, with his firm, has snapped up about 20 Eastern Market buildings for $25 million —has said this is about safety and that he wants to maintain the integrity of his buildings so the public can enjoy them. Hall has argued the leaky patch of floor at the deli has been a problem for years and predates his time as owner. The building is more than 100 years old. The lease agreement is unclear on who should pay, according to an expert's review.

Nelson's FIRM Real Estate has signaled it's open to a solution, telling The Detroit News: “We welcome Eastern Market Corporation’s assistance."

On Wednesday morning, Hall texted us his thoughts:

Featured_somethingrotten_33317
Nelson and his firm sent artist tenants packing last summer when they threatened sudden rent hikes of as much as 150 percent.

"I think the idea that we would be asked to pay for repairs on their building that they chose to not do due diligence on, to not preinspect before purchasing, and that they would even attempt to offload that failure, their failure, on to working people, primarily black Detroiters with stable jobs is ugly. That's the diplomatic way to say it.

"We are not yielding to the developer's will. To [request we] give them any amount of money without even a bid, on their say so, after being reinspected by the city without citation, is an incredibly disturbing and shameful move and we have no intention of propping up their extractive practices with the goodwill that we've created over 30 years.

"What we do is about people and place and that place isn't just 2465 Russell St., it's wherever we go and create a community, family, and a stable work environment."

Hall has said he's open to taking the business elsewhere. So consider reworking that GoFundMe campaign. To save the deli, you'll need to raise millions to buy out the landlord that owns its building, or at least tens of thousands to help it locate and move into new space. 

► Related Coverage: 

+ Derringer: Sanford Nelson, stop being such a schmuck

+ Eastern Market's New Landlords Have Artists Packing, Tenants Nervous

 



Leave a Comment:

Photo Of The Day