What’s next for the Shapiro’s building?

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By Karen Kennedy

 

Now that Shapiro’s Delicatessen on Range Line Road has officially closed its doors, questions surround both the potential future uses of the building as well as the complicated deal between Shapiro’s company, BJS, LLC and the City of Carmel.

 

Who owns the building?

Following the paper trail of the leasing arrangements of the building at 918 S. Range Line Rd. (referred to as “Parcel 10” in public documents) has proven to be extraordinarily complex.

Ryan Wilmering, attorney for the City of Carmel, explained how the leasing of the building was arranged: The real estate was originally owned by BJS. BJS leased the real estate to BJS II, LLC (also a Shapiro’s entity) and BJS II in turn subleased the real estate to Shapiro’s Carmel, Inc. In June, 2010, when BJS II assigned all of its interests in the lease and the sublease to the CRC, the CRC became both the tenant and the sublandlord. At that time, Shapiro’s Carmel was to have begun making rent payments in the amount of $1,000 per month to the CRC.

Under that lease agreement, BJS (which still retained a 98-percent ownership of the building) was obligated to pay the real estate taxes on the building. However, records show that as of May 2012, the CRC has been paying the real estate taxes ($27,448 annually) to avoid a tax lien on the property. Simultaneously, Shapiro’s Carmel fell behind on rent payments, and now is $79,000 in arrears to the CRC in rent.

On June 5, a holdover possession agreement was executed between Shapiro (and all of his business entities) and the CRC, in which Shapiro agreed to cease operations by June 15. It further states that all kitchen, building and operating equipment become the property of the CRC. According to Mayor Jim Brainard, Shapiro and his entities are in the process of deeding all of their interests in the property to the CRC and Brian Shapiro personally guaranteed the debt.

 

So now what?

In essence, the city now owns a two-story, 9,300-square-foot, fully furnished restaurant. According to Brainard, the city has had it appraised and is now exploring options to either sell or rent the building and its contents.

“Several parties have already expressed interest,” Brainard said. “Among them, a large, local restaurant chain and a real estate investor. We don’t anticipate that the building will be vacant for long.”

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