Demands by the owner of Boston’s Faneuil Hall Marketplace for payment of back rent from tenants who endured a three-month COVID-19 shutdown prompted a city official to raise the prospect of a potential change of ownership and management. 

Boston Planning & Development Agency Director Brian Golden asked operator Ashkenazy Acquisition Corp. to consider selling the ground lease on the city-owned property or turning it back to the city.

“The COVID-19 pandemic has created significant challenges for small businesses across our city, and around the world, especially those that rely heavily on the tourism industry. We strongly believe that the small businesses operating at FHM deserve ACC to act as a fair landlord,” Golden wrote.

New York-based Ashkenazy agreed to defer April and May rents following a phone call from Mayor Marty Walsh, Golden wrote, but is putting financial stress on tenants by requiring them to pay unpaid rent by Dec. 31.

In a prepared statement, Ashkenazy said it mentioned the Dec. 31 deadline previously to tenants.

“This was communicated to the BPDA leadership last Friday on a phone call. We are working to resolve this matter as soon as possible,” the company stated.

According to a Boston Globe report, Marketplace General Manager Joseph O’Malley this week emailed tenants that they can also defer June rents, but will be responsible for making up the payments in 2021.

Many landlords agreed to defer rents to retailers and restaurants during the government-ordered shutdown, through lease amendments and extensions that tack the unpaid rent onto the end of the term.

Golden noted that the BPDA has agreed to defer rents at its own properties for tenants directly affected by COVID-19, in some cases giving them five years to make up the missed payments.

Ashkenazy also has refused to support outdoor dining for food hall purchases, despite the city’s approval of expanded outdoor seating for restaurants, the letter states.

The BPDA asked Ashkenazy to defer unpaid rent until the end of 2021, assist tenants with outdoor seating and sanitizing measures and discuss rent relief for family-owned small businesses.

“Finally, given the historic nature of this property, I ask that when ACC goes to fill future vacant spaces that they commit to doing so in a way that advances equity, inclusion, and the prioritization of locally owned minority and women owned businesses that reflect the diversity of Boston,” Golden wrote. “If ACC is unwilling or unable to make these commitments, we request that ACC meet with the BPDA to discuss returning the property to public ownership or facilitate a transfer of the property to a private owner capable of making the investments necessary at the property.”

Ashkenazi took over the lease and management operations for the festival marketplace in 2011 from the original redeveloper, The Rouse Co. In 2015, it floated plans for major changes to the property, including conversion of the Quincy Market Rotunda into a two-story nightclub and converting upstairs offices in the South Market into a 180-room hotel, but never pursued the projects.

An outbuilding that housed a flower shop was demolished in 2016 to make way for a new Sephora cosmetics store.

BPDA Asks Faneuil Hall Operator to Give Tenants Relief

by Steve Adams time to read: 2 min
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