A West Village diner that had only been opened for a year was forced to adapt to a new reality when it’s bigger neighbor flexed its real estate muscle. That was drug store giant CVS, which decided it needed more space and summarily told that diner, known as Chalait, to start looking for new surroundings.
Due to a contract buyout clause in the diner’s decade-long lease, the move was perfectly legal. That clause, which is becoming standard in most business real estate deals, meant that CVS could end the lease after four years in favor of a larger operator. Chalait could have stayed the full four years, though the buyout amount would be been diminished considerably by that time.
While owner Michelle Puyane had some inkling about the move approximately a month before CVS officially informed her, she still had to scramble in finding a new place to set up shop. She found it at 299 West Houston Street, though the move only allowed her to get back roughly 50 percent of the original build-out expenses.
One of those expenses was a $12,000 air conditioning unit that CVS immediately discarded once they took back control of the property. That cold business move annoyed Puyane, who did admit to a certain amount of naivete in negotiating the original deal.
However, her main concern was the image the quick move represented. In the interim, she was able to open up small spots in both Chelsea Market and Nomad, yet she knew that this was a temporary fix because of the limitations imposed by such small confines.
Learning her lesson, Puyane did a much more rigorous examination of each potential area, deciding that Hudson Square would work best. Plenty of businesses are within walking distance, which should help during lunch periods.