CINCINNATI - The Banks riverfront development is having its first tenant trouble.
Toby Keith's I Love This Bar & Grill hasn't paid rent since November, according to a Feb. 8 lawsuit filed in Hamilton County Common Pleas Court.
An affiliate of Carter, the Atlanta-based developer of the Banks project, filed a breach of contract complaint against a limited liability company that operates the country-music-themed restaurant. The complaint alleges the 16,000-square-foot nightclub was more than $121,000 behind on its $41,000 monthly rent as of late December.
The landlord is seeking a judgment for "all rents, penalties, fines, interest and costs" payable under its lease agreement, plus interest and court costs.
An attorney for Toby Keith's said the company has placed rent in escrow because the landlord violated a lease clause promising it would not recruit competing venues to the Cincinnati riverfront.
"We have exclusive language in our lease that clearly states no other country-music themed bar will be in the project over 5,000 square feet," said attorney Gregory McClure. "They leased space behind us called Tin Roof, which became a direct competitor. They advertise on the same radio station. They book the same bands. As soon as they remedy the situation, they'll get every penny they're owed."
McClure said the bar is "financially viable" but it will shut down if the issue is not resolved.
"We love the city. The city loves us. I just think we have a bad landlord. They're bullies," he said. "It's the only landlord we have this issue with."
Toby Keith's was the first big-name tenant signed for the Banks project in 2010. It signed its lease a month after Cincinnati and Hamilton County authorized a $5.5 million loan to cover tenant-finish improvements for several retailers, including Toby Keith's at 145 E. 2nd St. The bar announced plans to hire 140 people in late 2011 and opened in February 2012.
The Toby Keith nightclub concept was developed by Capri Concepts LLC, a Scottsdale-based company. CEO Frank Capri could not be reached.
A spokeswoman for the Banks development team released the following statement:
"This is a dispute between Toby Keith's I Love This Bar and Grill and The Banks regarding back rent due. We hope to have it resolved as soon as possible. In addition, there have been questions regarding the status of the loan provided by the City of Cincinnati in 2010 for retail assistance and whether this dispute puts payment of that loan in jeopardy. That loan was made to the development team and not to individual tenants. The Banks development team is in good standing on this loan and intends to remain that way going forward."
Another Banks tenant said the lease dispute should not be taken as a sign of the riverfront district's overall viability.
"We're doing fine," said Jim Moehring, co-owner of the Holy Grail restaurant and bar. "One thing concerning to us is the overlapping of concepts down here. They have to do a better job of diversifying the tenants. Hopefully, they rectify the situation."