Denver’s largest hotel wants 7-Eleven out.
The joint venture that owns the Sheraton Denver Downtown Hotel on Tuesday countersued the convenience store that leases a portion of its building, asking a judge to award it control of the space.
The 7-Eleven at 1550 Court Place has been owned since October by a company founded by Kenneth Monfort, son of a Colorado Rockies co-owner. He sued the joint venture last month, alleging it “embarked on a bad faith mission to terminate the lease” for the store immediately after he bought it.
Hotel owner Denver HS-EF Court Place LLC — a joint venture between High Street Real Estate Partners of Atlanta and Eagle Four Partners of Newport Beach, California — has served the store with multiple letters of default since October for things such as dirty windows, shattered glass, open cleaning closets, a bicycle stored inside and unapproved signage. The countersuit also references “an incident in which pepper spray was pumped through the Premises’ air vents and into Landlord’s hotel.”
Robert Blume, an attorney representing the hotel ownership, said he expects a judge to side with hotel ownership, because their countersuit “focuses on adherence to the terms of the lease.”
“They’ve completely demonstrated to us just the lack of interest in abiding to the terms of the lease in good faith,” said Blume, of the Denver office of Gibson, Dunn & Crutcher.
Blume also pushed back against Monfort’s reference in the lawsuit to “surreptitious” inspections, calling that phrasing absurd. The landlord is required to give notice of planned visits to the store only when they’re maintenance-related, he said. Plus, certain violations of the lease — such as notices handwritten on cardboard and placed on the door, and unapproved window signage — can be seen from the sidewalk.
Additionally, Blume noted that the business itself is open to the public.
“There’s nothing surreptitious about walking into a 7-Eleven and buying a bag of chips and noticing the place is a s***hole,” Blume said.
‘First class’ requirement
Both parties agree that the lease with 7-Eleven states that the premises must be “operated as a first-class establishment.”
Asked if there was a standard definition of that phrase, Blume said, “There’s an objective understanding of what that’s not.”
7-Eleven has operated at the site since 2012. Prior to Monfort, it was owned by 7-Eleven corporate. The store was not served with any notices of default during that time, according to Monfort’s lawsuit.
Blume said that’s because, prior to October, the store “was not run in the decrepit way it’s run now.”
Monfort’s lawsuit also suggested the effort to terminate 7-Eleven’s lease was connected to an $80 million renovation of the hotel that began last year.
Blume said hotel ownership wants people in the area “to walk and feel safe like any other part of Denver.”
“Our effort to improve that end of 16th Street Mall means that we’re going to be far less tolerant of breaches of the lease that impact the atmosphere of that part of Denver,” he said.
Blume said Wednesday afternoon that there were no active discussions regarding a lease buyout or similar type of settlement.