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Bruckner Bar & Grill's Fate Uncertain Amid Dispute Over Post-Sandy Repairs

By Patrick Wall | February 12, 2013 3:18pm

PORT MORRIS — When Hurricane Sandy flooded the Harlem River last October, the damage to the low-lying Bruckner Bar & Grill was immediate and severe — overturned refrigerators, destroyed dishwashers, warped wood floors and grease staining every surface.

But, as it turned out, the full fallout from the flood had just begun.

Alex Abeles, the managing restaurant owner, Joseph Pryor, the managing building owner, and James Giddings, the restaurant co-owner and building majority owner, disagreed almost immediately about who was responsible for the repairs and what loans should be taken out to fund them.

That dispute soon descended into nitpicking over the terms of the lease, finger-pointing over missing flood insurance and charges from both sides of conflicted interests.

More than three months later, the debate has spiraled into threats of eviction and legal action — and the restaurant at 1 Bruckner Blvd. remains closed.

On Saturday, Abeles took to the restaurant’s Facebook page to blame the landlords for the standoff.

“They don't want to fix things they need to by the lease and now they also say that we owe them rent for the months that the restaurant was closed,” Abeles wrote in a post, which has since garnered more than 100 sympathetic comments. “I think they want to rent the place for more money or run it themselves.”

In an email to Abeles on Monday, Giddings returned fire.

“The landlord agreed to compromise. You are the problem,” he wrote in the message obtained by DNAinfo.com New York. “You are the reason Bruckner Restaurant LLC is closed.”

Meanwhile, residents of The Bronx and beyond have been begging for the return of the decade-old eatery and art space that is widely credited with helping spur the neighborhood's recent revival.

And they are mourning the void that has emerged in the absence of a restaurant-cum-community hub that attracted a diverse crowd of business people, police officers, teachers, government workers, artists and more.

“I’m devastated,” said Marlene Cintron, president of the Bronx Overall Economic Development Corporation, who called the restaurant “a beacon of light on Bruckner Boulevard.”

“We are extremely anxious for it to reopen,” she added. “We’re hoping everybody comes to their senses.”

Sandy’s surge filled the Bruckner’s basement to the ceiling and covered part of its first floor with saltwater and sewage, wrecking expensive machinery, including a walk-in refrigerator, ice machine and hot-water heater, and ruining thousands of dollars worth of food and alcohol.

The different parties and their lawyers proposed lopsided breakdowns of the responsibility for those repairs, documents show.

Abeles’ lawyer said the tenant — that is, the restaurant — should pay $6,700 and the landlord about $67,000.

Giddings — a party to both the tenant and landlord — suggested that the restaurant pay about $57,000 and the landlord about $17,000. (In a later proposal, he shifted some additional costs to the landlord.)

The differences stemmed from conflicting interpretations of the 2008 lease.

The restaurant’s side argued that the storm amounted to a “casualty,” in the event of which the lease says the landlord must repair the “premises.” The premises include “fixtures,” or fixed equipment inside the building, such as the refrigerators and dishwasher and other machines, they added.

The landlord’s side countered that the storm did not count as a casualty, so that the landlord is only responsible for repairing the roof and other structural elements and making sure that utilities can function. The basement, where most of machinery was stored, is not covered by the lease, they added.

The two sides also tangled over flood insurance — the restaurant had never bought it, but neither had the landlord compelled it to.

“I only wish you had taken flood insurance as seriously as you take hiring lawyers unnecessarily,” Giddings wrote to Abeles in an email.

While this debate raged, another soon erupted — what loans would the parties take out to pay for the repairs and necessary improvements?

Abeles suggested low-interest loans through FEMA and the federal Small Business Administration. He prepared the FEMA loan application, but Giddings declined to sign on, according to Abeles.

Giddings denied refusing to sign the application and noted that he eventually pushed for the SBA loan.

He also offered for his private company, Falkenberg Group LLC, to make a one-year, $50,000 loan at 15 percent interest — but Abeles complained that the rate was many times higher than those of the government loans.

“[Giddings is] happy to offer a usurious private loan at 15%,” Abeles wrote in an email to Pryor.

During these heated discussions — many of them by email — Abeles pointed out that Giddings owns 65 percent of the landlord company and 50 percent of the restaurant.

“That puts [Giddings] in a conflict situation with regard to negotiations between the Landlord and Tenant,” Abeles wrote in the email to Pryor. “He keeps claiming he is being neutral but it is not so.”

Giddings, in turn, noted that Pryor is the landlord’s managing member with sole lease negotiation authority, and called attention to Ceetay, a new sushi restaurant near the Bruckner that Abeles co-owns.

“Your new restaurant has taken business away from the Bruckner and remains open today,” Giddings wrote in a December email. “If anyone has a true conflict of interest it is you!”

As the dispute wore on and the restaurant remained shuttered, the landlord sent rent notices.

Last month, Giddings drafted a lease amendment that would forgive the restaurant of three months’ rent if it agreed to assume full responsibility for the repairs and immediately buy flood insurance.

Abeles balked and, on Monday, the landlord sent him a bill for more than $28,000 in back-rent and late fees.

Earlier, Pryor had said that by failing to pay rent since December, the restaurant had defaulted on the lease.

“Landlord will move to dispossess tenant as a result of this default,” Pryor wrote in an email to Giddings and Abeles.

It now seems likely that the dispute will be resolved in court.

In an email interview Monday, Giddings said that Abeles appeared to have chosen legal action over compromise.

“He seems to prefer the legal route and that’s the story for now,” Giddings wrote. “The courts are designed to resolve these kinds of differences of opinion.”

Abeles, meanwhile, said that the other parties’ actions had left him little choice.

“This is horrible behavior and the fact that no one has time to sit down and hash this out is ridiculous,” he wrote in the December email to Pryor. “I want to bring this situation to an end.”