The Hobby Center has filed a lawsuit in Harris County District Court in an attempt to terminate the lease of Artista, the restaurant operated in the performance venue by Cordua Restaurants. In the pleading, the Hobby Center claims that Cordua Restaurants "chose not to exercise its Renewal Option and refused to pay the Renewal Rental Rate determined by the Lease's appraisal process."
The disagreement comes at the end of Artisa's 10-year lease, which initially expired last year, but was renewed until April 2013 to allow both parties to negotiate a new lease. After participating in the negotiation process through an appraiser, the suit alleges that Cordua Restaurants objected to the lease's specified method of calculating the new rent when two other appraisers determined a different rate than the one determined by Cordua's own appraiser.
Cordua Restaurants has "enjoyed 10 very successful years at the Hobby Center, and we're looking forward to the next 10."
The lawsuit claims that both the Hobby Center's appraiser and a third appraiser determined Cordua Restaurants should pay approximately 45 percent of beverage sales to the Hobby Center, while the Cordua's appraiser thought it should only be 35 percent.
At that point, the Cordua's appraiser told the Hobby Center that "Artista maintains now that the whole appraisal process is erroneous per the lease and I agree with them." However, the Hobby Center responds that it only agreed to extend the lease and renegotiate once Cordua specifically agreed that these provisions for determining a new lease rate were valid.
Since the parties are unable to agree to terms and the 30-day notification period expired, the Hobby Center has asked that the lease be terminated. Essentially, the suit simply asks a judge to confirm that the Hobby Center has acted according to the lease's terms and now has the authority to terminate its relationship with the Cordua Restaurant Group and kick out Artista.
Executive chef David Cordua tells CultureMap that the company is "in the process of putting our response together" to the Hobby Center's pleading. Although he declined to get into the specifics of the Hobby Center's allegations, he did say that Cordua Restaurants has "enjoyed 10 very successful years at the Hobby Center, and we're looking forward to the next 10."
That response should make for interesting reading. Perhaps the strangest aspect of the whole situation: Michael Cordua is on the Hobby Center's Board of Directors. Seems like there's more to the story than the initial legal pleading provides, but isn't that always the case when two sides bring out the lawyers.
CultureMap contacted the Hobby Center, but officials there declined to comment.