Fraim Flight Hides Possible Folly

You never take a knife to a gunfight, as the saying goes.

In the Fraim flight fracas, Mayor Paul Fraim took City Manager, Marcus Jones, and City Attorney, Bernard Pishko, his two top guns, to meet with representatives of The Cordish Cos. 

According to press reports, the three city officials flew to Baltimore June 16, 2014, at Fraim's expense. Cordish, a private developer based in Baltimore, will redo Waterside into Waterside Live!, a post-modern playground for adults.

The mayor is there because he's the mayor. The city manager because he can talk about city finances. And the city attorney is there because he is can render a legal remedy, presumably, to a legal problem.

So what could be the legal entanglement? Because if there is no legal impediment, there wouldn't be a need for the city's top attorney.

Why take a gun unless you plan to use it.

Let us assume the mayor, aided by his minions, wanted something from The Cordish Cos. We can further assume that Cordish was delaying its agreement with the city for reasons undisclosed to The Public and most likely wanted something from the mayor.

What do we know?

We know Joe's Crab Shack had a lease (a contract) with Waterside Associates LLP, whose managing partner is Norfolk Redevelopment and Housing Authority.

We know Joe's had the option to renew its contract for five years, until 2018, according to a rider in the contract, and exercise its right to be the exclusive seafood restaurant in Waterside.

We know Joe's did exercise its option to renew its lease for five years and informed the landlord, Waterside Associates, of its option to do so.

We do know Joe's has a Federal Express receipt showing C. Richards signed for the package from Joe's saying it was renewing its lease for an additional five years. And we know the letter was addressed to the general manager of Waterside, whose name is still a mystery.

What don't we know?

We don't know what the parties discussed.

We don't know which restaurants or other entertainment venues will populate Waterside Live!, because Cordish has refused to disclose their names, at least to The Public.

We don't know if the city or the housing authority, or both, neglected to renegotiate Joe's lease within a 120-day time frame, as set out in the terms of the lease.

But it's a possibility.

We don't know if Mayor Fraim and his two guns wanted Cordish to bury the costs of buying out Joe's lease so as not to embarrass city officials should it ever become public that someone screwed up.

But it's a possibility.

We don't know if Cordish said no, you figure it out.

But it's a possibility.

We don't know if one top gun suggested an option: that of evicting Joe's for late payment of rent over a two-year period.

But that's a probability.

We don't know if one top gun suggested that if Joe's files a lawsuit, it would be financially less expensive and politically less condemning than public disclosure of a Big Mistake.

Certainly, it is probable.

In July, a month after The Cordish trip, Joe's gets a notice from the housing authority's law firm, Crenshaw Ware & Martin PLC, threatening eviction from Waterside and legal action if Joe's doesn't comply.

Of course, this is all speculation and should not be construed as an actual record of events leading to and prompting Joe's filing a lawsuit against Norfolk Redevelopment and Housing Authority, the landlord, August 25 with Norfolk Circuit Court.

Here's a chronology of events, gathered from press reports, press releases and the lawsuit.

February 27, 2013 – Edward Engel, senior vice president and general counsel of Crab Addison Inc, otherwise known as Joe's Crab Shack, sends a letter to the general manager of Waterside Associates Limited Partnership, Waterside's landlord, saying it was exercising its option to renew its lease for five years, commencing July 1, 2013, according to section 1.2 of the “rider” to the lease.

February 28, 2013 – The Federal Express package with the notification letter was received by Waterside Associates Feb. 28, 12:57pm, according to a delivery receipt, and signed by C. Richards.

July, 2013 – A Cordish representative, Michael Stoltz, inquires about Joe's lease with Waterside. He contacts Thomas Hundrieser, director of Real Estate for Ignite restaurant Group, and Tara Schroeder, lease administrator for Ignite Restaurant Group. Both Hundrieser and Schroeder tell Stoltz the city received notification of the lease renewal and provided the Federal Express delivery receipt and tracking number.

Ignite Restaurant Group, the owner of Joe's Crab Shack restaurant brand, is a publicly traded company whose shares are bought and sold on the Nasdaq stock exchange.

August, 2013 – Norfolk chooses The Cordish Cos. to redevelop Waterside Festival Marketplace into Waterside Live!, a complex of bars, restaurants and shops.

November 20, 2013 – Shurl Montgomery, CEO/executive director of NRHA, notifies Joe's that its month-to-month lease would be terminated because The Cordish Cos. was assuming control of Waterside.

November 26, 2013 – In response, Schroeder “vehemently disagrees” with Montgomery that Joe's is a month-to-month tenant. Schroeder adds that Joe's has the legal right under section 1.2 of the “rider” to renew its lease for three five-year periods provided the landlord is given 120-days notice.

May, 2014 – NRHA CEO/executive director, Shurl Montgomery, announces his retirement, effective Dec. 31, 2014.

June 16, 2014 – Mayor Fraim, City Manager, Marcus Jones, and City Attorney, Bernard Pishko, meet with Cordish representatives in Baltimore.

July 24, 2014 – Attorney Delphine Carnes with the law firm of Crenshaw, Ware & Martin sends an eviction notice to Joe's and threatens legal action if Joe's has not vacated Waterside by Aug. 31.

August 25, 2014 – Joe's files a lawsuit against NRHA in Norfolk Circuit Court, dated August 25. Chairman of NRHA board of commissioners, F. Nash Bilosoly, served August 29, 2014, according to court records.

September 12, 2014 – Bilosoly, an attorney, announced his resignation from the board, citing an extensive workload at his law firm, Vandeventer Black LLP, of which he is a partner.

October 31, 2014 – Cordish takes control of Waterside.