The owner of the Market Tower office building at 10 W. Market St. in downtown Indianapolis is suing CVS, alleging the retailer improperly terminated its lease and stopped paying rent after the store was damaged during downtown rioting this spring.
The CVS location, at 175 N. Illinois St., occupies one of several retail spaces on the ground floor of the Illinois Street parking garage. Market Tower Property LLC owns both the garage and the adjacent office tower.
The property was damaged May 29 as part of the widespread rioting and civil unrest in downtown Indianapolis and the store has been closed ever since.
CVS spokeswoman Amy Thibault told IBJ in an email that “no plans for the future of that location have been decided at this time,” but the store has transferred all of its prescriptions to its CityWay location at 336 S. Delaware St.
Market Tower Property initially filed its case in Marion Superior Court Oct. 29 against Woonsocket, Rhode Island-based Hook-SupeRx LLC, which does business as CVS. The case was moved to federal court this month.
CVS’s predecessor, Hook Drugs Inc., had operated a store at the Illinois Street location since 1982. Under the terms of the current lease, signed in 2015 and intended to run until 2031, CVS had been paying $14,564 per month for the 8,287-square-foot space, according to documents filed as part of the case. Rent was to increase every five years.
The lease agreement also contains a clause that allows either party to terminate the lease early if the premises are either totally destroyed or damaged so badly by fire or other event that the premises cannot be restored within six months.
On July 15, CVS sent a letter to Market Tower saying that the retailer had investigated the damage at the location “and found it to be severe and a total loss and will take much longer than six months to rebuild and/or restore.” Because of this, CVS said, it intended to exercise its right to terminate its lease effective July 31.
But, in its suit, Market Tower Property argues that CVS did not have the right to exit the lease early.
“Market Tower has provided CVS with reports from contractors, architects and structural engineers engaged by Market Tower, all of which show that the restoration of the premises can be completed in six months or less,” the lawsuit says.
Market Tower also alleges that CVS has provided no evidence supporting its claim that the restoration work would take longer than six months and that the retailer has refused to cooperate with restoration of the premises.
Neither Market Tower’s lawsuit nor CVS’s legal response details the specific damage to the retail space.
In its suit, Market Tower is asking the court to declare that CVS’s lease termination is invalid. The landlord is also asking that the court order a judgement against CVS that would award Market Tower back rent, operating and property taxes owed, along with interest and other costs.
Market Tower’s suit does not name a specific amount it is seeking.
Market Tower is represented in the case by Indianapolis attorney Charles E. Oswald IV of the firm Harrison & Moberly. CVS is represented by Chicago attorney Jonathan Garlough of the firm Foley & Lardner LLP. Neither attorney immediately responded to email and phone messages Friday.