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New York, New York
therealdeal.com/2021/06/02/westfield-... Westfield sues Victoria’s Secret over WTC mall locationThe landlord seeks $32M, alleging missed rent and wrongful abandonment
New York /
June 02, 2021 04:14 PM
By Sasha Jones | Research By Orion Jones
For years, Unibail-Rodamco-Westfield has been engaged in a legal dispute with Victoria’s Secret over its Westfield World Trade Center location. Now, the mall landlord is firing back.
Westfield is suing the retailer, claiming that it has stopped paying rent and wrongfully abandoned its store in the downtown shopping mall, according to a complaint filed in a New York court Friday.
On Jan. 4, Victoria’s Secret informed Westfield that it had terminated its lease as of Jan. 1, because the mall’s co-tenancy requirements were not being met, according to the complaint.
Under the terms of the lease, 75 percent of the mall’s ground floor must be occupied and those stores must be operating. If that percentage dips below 75 percent for more than a year, Victoria’s Secret may end its lease, with fair warning to Westfield.
However, Westfield responded by informing the tenant that those criteria for lease termination were not being met, as Westfield had not failed to meet the co-tenancy requirements for 12 consecutive months. Westfield claims that the retailer’s assessment was based solely on “physical observations” by Victoria’s Secret personnel, despite evidence the landlord provided to the contrary.
By that point, the complaint alleges, Victoria’s Secret had stopped paying rent. On March 11, Westfield sent the retailer a Notice of Default, which indicated that it had missed over $4 million in payments.
Since the lease includes accelerated rent, Westfield’s lawsuit is seeking more than $32 million in damages altogether.
Just a month later, on April 30, Victoria’s Secret abandoned the space, according to the lawsuit. A photo uploaded to Google shows a sign on the store’s window, which states that it closed April 12.
The space has long been a sore spot between the two companies. In 2019, Victoria’s Secret sued the landlord, claiming that, four years after the expected store opening, Westfield failed to complete construction on the site.
In February, it was reported that Victoria’s Secret would close 30 to 50 stores in the U.S. and Canada this year. That’s on top of 241 store closures in 2020.
Westfield declined to comment on pending litigation. Victoria’s Secret did not respond to requests for comment.