Montreal restaurant manager is shocked when retail space is suddenly listed as available for rent

Nilufar Al-Shourbaji woke up Tuesday to confusing text messages as friends demanded to know why her family’s restaurant, a mainstay on Montreal’s Ste-Catherine Street, was closing.

“You could have let us know,” Al-Shourbaji said, recounting the texts.

“I wish you’d talked to us before you sold the place and I’m like, ‘What the hell are you talking about?'”

His friends were asking him why the Nilufar restaurant, which bears his name, was listed as available for rent online.

Listed at $3,170 per month for 950 square feet of retail space, the restaurant is located just west of St. Marc Street downtown.

It is known for serving up tasty dishes at exceptionally low prices, even now that the cost of living is skyrocketing.

The restaurant opened in 1994, selling falafel pitas for 99 cents. Today, you can get a full meal there for around $6, because the family believes in making food accessible to everyone – feeding as many people as possible.

Despite COVID-19 restrictions that have led to restaurant closures across the city center and ongoing labor shortages, Al-Shourbaji said his business is doing very well.

Landlord says his dad rejected long-term lease

So it was a surprise to see the ad online, with an asking price significantly higher than what her family pays each month, she said.

And while the landlord may be looking for a deeper-pocketed tenant, she said he never spoke to her or her family about the potential rent hike before posting the listings online.

“Just imagine you’re sitting in your childhood home and looking at a listing and your childhood home is for sale or rent and you have no idea,” Al-Shourbaji said.

For several years, the restaurant has been rented on a monthly basis.

The owner, Ziki Zaffir, said his company had offered Al-Shourbaji’s father a long-term lease.

“He’s made it clear he’s not interested because he’d rather retire and what we want, we want the long-term lease at fair rent,” Zaffir said. “The guy is also paying very old low rent.”

Asked about it, Al-Shourbaji said his family had not been approached for a long-term lease, and based on what happened, they will definitely not sign an agreement with the landlord now.

Aggressive rent-raising tactics

Glenn Castanheira, chief executive of the Downtown Montreal Merchants Association, said it was the first time he had heard of a landlord who was renting out commercial space without telling the tenant.

However, he has seen many aggressive tactics when it comes to raising rent, he said.

Long-term tenants are facing explosive rent hikes and poor property management, he said.

“It’s not the majority of city center owners, thankfully, but it’s something that happens more frequently than we’d like to admit,” Castanheira said.

Glenn Castanheira is the Executive Director of the Downtown Montreal Business Association. He says not all landlords are aggressively raising rents, but some are. (Radio-Canada News)

Despite the economic hardships that have accompanied the pandemic, downtown has become an attractive and bustling commercial area and, “in a word, we are victims of our own success,” he said.

It attracts “massive investment” and landlords see this as a reason to leave a space vacant until a big business, usually a franchise, is ready to pay high rent, he explained.

Or, the owner can choose to wait for the property’s value to increase and simply sell the building, he said.

“A lot of these owners are holding these businesses hostage within their own business,” he said, because it’s so expensive, especially with a restaurant, to pack everything up and move.

“What these companies end up doing is they pay rent and they pay their staff, and they end up bringing home a meager, meager salary.”

Often, he said, businesses are forced to close shop.

Traders association wants more regulation

The Nilufar restaurant is located in an area that has grown over the past five years, attracting investment and speculation, and Castanheira suspects there will be more cases of businesses being pushed out of the area.

But there are ways to help business owners stay in business, he said.

The downtown merchants association wants to see new regulations on commercial leases, such as renewal clauses and pre-negotiated rent increases, he said.

The group would also like to see stricter rules when it comes to keeping commercial spaces vacant, requiring landlords to keep them sufficiently lit, clean and maintained for the next tenant to move in at any time.

“These are things that must be put forward as soon as possible to limit these abuses,” Castanheira said.

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