Letter To NIC
Letter To NIC
CINCINNATI
OFFICE OF THE
CITY MANAGER
Harry Black, City Manager
September 11,2014
Via Personal Delivery and Email
Ms. Tracy Schwegmann
Jeffley R. Anderson Real Estate, Inc.
Rookwood Tower
3805 Edwards Road, Suite 700
Cincinnati, OH 45209
Re: Mahoganys at The Banks Lease with NIC Riverbanks One. LLC (landlord)
Dear Ms. Schwegmann:
The City is in receipt of your letter dated September 2, 2014 to Mahoganys and the City of
Cincinnati in which you notified Mahoganys and the City of the landlords election to terminate
Mahoganys Lease at The Banks effective 10 days from the date of the Citys receipt of your letter
(namely, Friday, September 12), subject, however, to the Citys right to take action under the
Landlords Consent agreement among the landlord, Mahoganys and the City.
Please be advised that the City has elected not to take any action under the Landlords Consent
during the specified 10-day period.
As referenced in the Landlords Consent and your letter, and as collateral security for the economic
development assistance that was extended by the City to Mahoganys in 2012, the City presently
holds a leasehold mortgage on the leased premises, as well as a security interest in all furniture,
fixtures, equipment, inventory and other personal property that is located at the leased premises and
used in connection with the restaurant (the Collateral), as more particularly described in the Citys
fmancing documents.
For the benefit of the City and the Citys taxpayers, the City respectfully requests that the landlord
refrain from taking any action to remove, or to require the removal of, the Collateral, or any action
that might impair the value of the Collateral, without first giving the City a reasonable opportunity
to exercise its rights under the Citys financing documents to safeguard and ensure the proper
disposition of the Collateral. Similarly, by copy of this letter to Mahoganys, the City is hereby
notif~ing Mahoganys that it is prohibited from removing the Collateral from the restaurant, or
taking any action that might impair the value of the Collateral, without prior written authorization
from the City.
801 Plum Street, Suite 152 Cincinnati, Ohio 45202-5706
P513 352 3241 F 513 352 6284 www.cincinnati-oh.gov
The City will continue its efforts to attract and retain small businesses in the City. Unfortunately,
the Citys experience with Mahoganys illustrates the inherent risk in the restaurant industry. As
such, while the City will work with the landlord and Mahoganys to wind down operations
amicably, the City does not intend to extend further financing for similar enterprises. Kindly
continue to keep the City informed of pertinent matters pertaining to the pending termination of
Mahoganys Lease so that the City can respond accordingly.
Thank you, and please contact Jeff McElravy (352-1561) with any questions should you wish to
discuss this further.
Sincere~y,
Harry Black
City Manager
cc: Elizabeth Rogers
Robert Croskery
Jeff McElravy, Interim Director, Dept. of Trade and Development
Terrance Nestor, Interim City Solicitor