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Eviction suit hits Sudler Sotheby's
By Andrew Schroedter, Oct. 28, 2009
In the latest controversy to befall Sudler Sotheby’s International Realty, a landlord has sued to evict the residential brokerage from its offices in the historic Palmolive Building, saying the firm owes nearly $371,000 in rent. A venture owned by Beverly Hills, Calif., investor Ross Hilton Kemper filed a complaint Monday in Cook County Circuit Court, asking a judge to order Sudler’s parent company, Chicago-based McNair Inc., to surrender its third-floor office in the Art Deco tower, 919 N. Michigan Ave., and pay the past-due rent.
The lawsuit is the latest setback for Sudler, which acquired rival Century 21 Sussex & Reilly in February. The deal boosted Sudler’s marketshare but resulted in broker defections, a lawsuit by a top-ranking Sudler executive and a rent dispute over the former Sussex office in the Roscoe Village neighborhood.
Sudler CEO Sergio Martinucci expressed surprise at the lawsuit, saying the firm pays rent every month.
But he acknowledges that the company has been withholding a portion of its rent each month because he says the landlord, Michigan Avenue Retail LLC, has failed to live up to a promise to increase the size of the Sudler sign on the building, where Sudler leases 9,938 square feet.
“They won’t give us what they promised,” Mr. Martinucci says. Therefore, “we’ve been paying what we feel is our proportionate share of the rent.”
The eviction complaint was filed by Michigan Avenue Retail, which Mr. Kemper owns. A spokesman for venture had no comment. The venture’s attorney, David Saltiel, a partner in the Chicago office of law firm K&L Gates LLP, also declined to comment.
Under a 10-year lease that began in September 2006, the firm’s annual rent is $332,426, or $33.45 per square foot. Sudler has closed offices this year in Hyde Park and Bucktown. The company has four North Side offices, including the one in the Palmolive Building.
While Sudler is seemingly going through a particularly tough amid time the sharp slowdown in residential sales, they are not alone, says Jim Kinney, vice-president of luxury home sales at Chicago-based Baird & Warner Inc.
"Everyone is being affected by the downturn in the market," he says.
