Norwich marina owner: City waived back rent payments, current rent paid

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Norwich — The company that owns the Marina at American Wharf disputes the city’s claim that it is in default of its lease, either in rental payments or maintenance of the property, while city officials questioned the basis of that claim Wednesday.

The City Council on Monday voted 6-0 to approve a resolution to order marina owner JCM Norwich Marina Acquisitions LLC to pay back rent owed to the city within 30 days and to begin work on maintenance and repairs at the marina within 45 days or be found in default of the ground lease for the city-owned property.

But Attorney Glenn Carberry, representing JCM, alerted the city Monday to a certification dated Sept. 8, 2017, signed by City Manager John Salomone that affirmed the validity of the lease and accompanying development agreement and that “JCM is current on the payment of any rent and all other amounts due to the City thereunder,” the so-called Estoppel Certification stated. The Day obtained a copy of the Estoppel Certificate from the city Wednesday.

In a letter provided to the City Council prior to the vote Monday, also obtained by The Day, Carberry said the city waived any right to back rent payments of $5,000 per year as spelled out in the lease prior to Sept. 8, 2017. JCM submitted a new rent payment of $5,000 to the city on Monday to cover 2018 payments, and the first $2,500 installment of 2019 rent is not due until the end of June, making the marina owner current on all rent payments.

City officials, however, continued to dispute those claims Wednesday. Salomone said he could not comment substantially on the legal issues but said marina conditions that existed at the time of the certificate have since changed.

JCM has been trying to find a buyer for the marina as the dispute between the city and the current owner has heated up.

“The restaurant was open,” Salomone said of the 2017 conditions. “The fuel tanks were in; the festival tent was up.”

The seasonal restaurant hasn’t opened this year, and the marina owner removed the tent.

Mayor Peter Nystrom said his position is that the city did not waive rent payments in the Estoppel Certificate, and “we are proceeding in demanding all back rent.”

Nystrom said the city has not yet processed the new 2018 rent payment, as city officials need to affirm to which rent bill the payment should be applied.

Carberry declined to comment on the issues Wednesday.

In his letter to the city, Carberry wrote that he submitted the payment for the 2018 rent, “on the condition that the payment will be accepted, and a receipt provided to JCM indicating that it is for the 2018 Base Rent.”

Carberry also argued in the letter that JCM has no obligation in the lease to replace the fuel tanks. The state mandated removal of the tanks after they reached their 30-year lifespan in 2018. Carberry pointed out that the lease allows the marina owner to demolish improvements that have deteriorated, “which is what happened with the fuel tanks, as long as the disturbed area is restored, and debris are removed,” Carberry wrote.

Carberry claimed the council, in its resolution approved Monday “completely ignores” specific language in the development agreement, accompanying the lease, that would allow replacement of improvements within 10 years of demolition.

Referring to other deteriorated conditions described by city officials and boaters, Carberry noted that JCM made extensive repairs and improvements in 2012, and now seven years later, more work does need to be done. He said “some repairs” to rotted boards on one observation platform will be done within a few weeks. The festival tent had a “substantial rip,” and JCM discussed the need to repair it with prospective marina buyers.

Nystrom maintains that the lease calls for the marina owner to maintain all improvements, including the unsafe, rotted observation platform, the pool area, the tent and the fuel tanks, deemed critical to the attractiveness of the marina to boaters coming up the Thames River.

Salomone said he hopes to schedule a meeting with marina representatives to discuss the issues, including ongoing maintenance issues.

In his letter, Carberry wrote that JCM is committed to trying to find a buyer and present the proposed lease transfer to the City Council, and the owner had hoped the council would withdraw the resolution approved Monday “and work with the company instead to finalize a transaction during the current boating season.”

c.bessette@theday.com

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