Ruth’s Chris, Aspen landlord square off in court | AspenTimes.com

Ruth’s Chris, Aspen landlord square off in court

Rick CarrollThe Aspen TimesAspen, CO Colorado

ASPEN – A business dispute between Ruth’s Chris Steak House and its landlord is at the heart of two cases in Pitkin County District Court.Arguments began Monday in a bench trial concerning alfresco dining at the upscale restaurant, following an eviction notice filed by its landlord, Galena Street LLC, on Friday.Aspen attorney Matt Ferguson, who is representing Galena Street LLC in the patio-dispute trial and the eviction proceedings, claimed in court that Ruth’s Chris was late with this month’s rent and has inconsistently paid its common area maintenance (CAM) charges. And that’s why the landlord wants Ruth’s Chris out of the space, located at the corner of Cooper Avenue and Galena Street, where the monthly rent commands $35,412, plus CAM charges.But Judge Denise Lynch, who is presiding over the patio-dispute trial, will not have a say in the eviction proceedings, which is being handled by Judge James Boyd.”[The eviction] case has been assigned to another judge for another day,” Lynch said.Instead, it will be up to Lynch to decide whether Galena Street LLC, controlled by M & W Properties, breached its lease agreement with Ruth’s Chris. The thrust of Ruth’s Chris’ argument is that the landlord won’t let it use the north patio for outdoor dining, even though its lease allegedly says it can. And, according to Ruth’s Chris’ lawsuit, filed in April 2008, Royal Street Fine Art, which occupies 800 square feet of the building, has used the patio in question to store some of its inventory. Ruth’s Chris also is asking the court to terminate the lease, which would take it off the hook for future rent. However, the landlords, who own and operate the master lease to the building, claim they made it clear that Ruth’s Chris cannot use the north-facing patio.While those facts are in dispute, what’s not is the financial performance of Ruth’s Chris in Aspen, where it opened in January 2007 after signing a lease in August 2006.In Monday’s opening arguments, Ferguson said Ruth’s Chris experienced losses of “over $1 million” in 2007 and “over $700,000” in 2008. As for this year, “they’re still losing money,” Ferguson said.Tom Becnel, a commercial developer from Destin, Fla., and a principal with Colorado Steakhouse LLC, which owns and operates the Ruth’s Chris in Aspen, testified that business here has been lackluster. As a result, operating partner Bill Parker was fired, and the current owners are seeking a tenant to sublet the 5,900 square feet of space.Unlike Ferguson, Becnel could not assign a dollar figure to how much money the Aspen location has lost. “The restaurant has not performed to our expectations,” he testified, adding that Colorado Steakhouse LLC went over budget by $300,000 when it spent $1.55 million to renovate the space before it opened.Adding to the restaurant’s financial woes was that the Aspen airport closed for two months in April 2007 and the current recession, said Becnel, who owns a home in Snowmass Village.rcarroll@aspentimes.com

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