Morguard Corp., the developer behind the new downtown office tower that’s incorporating the historic Grant House building, terminated the lease agreement with Marisol Simoes and her husband, Zadek Ramowski.
The well-known local restaurateurs co-own Asian fusion restaurant Kinki and the Latin-style Mambo, both located in the ByWard Market. They were selected as tenants to occupy the Grant House, which will be connected to the 21-storey office tower via a glassed-in “winter garden” that would serve as both a patio and art gallery.
But after various setbacks, Morguard ended the contract with the restaurateurs, who were operating under the business name of 224 Inc.
A statement of claim filed against Morguard states 224 Inc. is seeking various claims including $1 million in general damages for breach of contract and negligent misrepresentation, $500,000 in punitive damages as well as special damages to be determined at a trial.
“This has taken a good three years out of our lives and has left us with nothing to show for,” stated Mr. Ramowski in an email to OBJ. “We have invested significant amounts of money, effort and time.”
He would not comment on how much money was invested in the project, except to say that it was “enough to be upset about.” Renovations had begun, starting with gutting the Grant House and initiating structural upgrades.
Arthur Tallis, Morguard’s eastern regional vice-president of property management, was the go-between for 224 Inc. and the developer, and is named in the legal claim. Mr. Tallis was unavailable for comment, and another employee said no one else would be able to comment on the matter.
The statement of claim lists various problems that occurred following the lease agreement, which was signed in September 2010 and ultimately terminated by Morguard.
One such issue was that 224 Inc. claims Morguard and Mr. Tallis assured them the restaurant would be in operation for at least five years before construction on the commercial building would begin.
But in December 2010, Morguard informed 224 Inc. that it had found a potential tenant for the high-rise, according to the legal document, and that construction would begin the following year.
The restaurant set a target opening date of April 1, 2011. During the renovation process, many complications were allegedly discovered along the way: power supply and plumbing deficiencies, zoning challenges and concerns about fire exits, to name a few.
On Dec. 23, 2011, Morguard terminated the lease agreement with 224 Inc. stating that a restaurant could not be opened on the premises.
The following February, however, Morguard submitted documentation to the City of Ottawa confirming that the Grant House could and would be developed for use as a three-floor restaurant. The 48-page document prepared by Morrison Hershfield Ltd. outlines how the office tower and Grant House fit in with the Ontario Building Code, and explicitly states that “the proposed use of the (Grant House) building is a restaurant on the ground, second and third floors.”
Mr. Ramowski said he was unaware of what restaurant might take its place.
Neither party would disclose court dates or updates on the legal proceedings.
SIDEBAR: RESTAURANT PROFILE
The London Pub and Steakhouse, as it was to be named, involved $2 million worth of renovations and planned to feature an innovative menu going beyond traditional steak and potatoes, according to media reports from 2010.
Each level of the three-storey building would have a different atmosphere. The main level was to be an eclectic lounge meant for lunches, after-hours cocktails and light dinners.
The second floor would be for formal dinners with live music, interesting light fixtures, abstract paintings and patterned fabrics.
On the top floor (formerly an apartment), customers could conduct private meetings with audio-visual capabilities.
One of the difficulties 224 Inc. ran into was that the top floor was zoned for residential use and unsuitable for a restaurant. Its projected occupancy of 80 people was also deemed unsafe because of the inadequacies of emergency exits, according to a report prepared by Judy Jeske, senior code consultant at Morrison Hershfield Ltd.
Restaurateur Zadek Ramowski would not disclose if him and his wife Marisol Simoes plan to open the restaurant at another location.
150 ELGIN ST.
Grant House was built in 1875 for member of Parliament Sir James Grant. At one point, it served as the clubhouse for the University of Ottawa.
In 1972, restaurateur Ken Dolan opened Friday’s Roast Beef House, which remained open until 2009 when the rent was raised and sales were declining.
Morguard purchased the block of land from the City of Ottawa in 2005 and began to plan an office and retail building for the surface parking lot behind Grant House. Plans at one point included a new concert hall, but were ultimately scrapped. In 2011, the Canada Council for the Arts signed an offer to lease approximately 80,000 square feet inside a newly designed office tower.
Construction began in November 2011 and the first tenant is expected to take occupancy on Jan. 1, 2014.
Performance Court is the only non-government office building currently under construction in Ottawa’s downtown core.