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Furniture mart tenant can’t break free of lease

A World Market Center tenant lost an unusual attempt to break its lease early after the business it generated at the semiannual shows fell short of expectations.

Bel Air Lighting Inc., a wholesaler based in Valencia, Calif., contended during a five-day trial that it had agreed to take a World Market Center showroom based on promises that it could be on a floor with other lighting companies in Building C’s 10th floor. However, Building C opened in mid-2008, as the economy was in a downward spiral, and the lighting destination floor was dotted with vacancies.

As the recession hit the furniture industry particularly hard, World Market Center filed dozens of legal actions against tenants that quit paying rent and left. Some could no longer afford the Las Vegas markets; others went out of business.

Bel Air, however, was the only one that became a plaintiff, asking for not only an immediate and cost-free end to its lease but also a rent refund dating to the filing of the lawsuit in March 2011. However, it said its accounting system could not track sales that flowed from the markets so it could not quantify any decline.

In a written ruling, Clark County District Court Judge Elizabeth Gonzalez found that Bel Air never received a legally enforceable promise and never showed any damages in the form of lost sales. Also, Bel Air took advantage of discounts World Market Center offered – half off the rent in 2009, followed by a 25 percent discount in 2010 and 10 percent last year. This year, full rent resumes at $27,000 a month until Bel Air’s lease ends in June 2013.

Bel Air initially joined a group of lighting tenants that requested a move to another part of the center with more traffic, but ultimately stayed put even as others left.

These factors contributed to the verdict in favor of World Market Center and opened the possibility that Bel Air could pay tens of thousands of dollars for the center’s legal bills.

Bel Air Chief Operating Officer David Ziv said he was “disappointed,” but declined to comment further.

Bob Maricich, CEO of International Market Centers, which owns the World Market Center and furniture and accessory trade show venues elsewhere, notably High Point, N.C., said, “The ruling was both fair and gratifying. As the landlord to the world’s leading home furnishings and interior design brands, this is an unfortunate situation we are happy to put behind us.”

The World Market Center’s three huge buildings house both permanent and temporary showrooms for several hundred companies. Most of it is dark 50 weeks a year, but its one-week shows early in the year and mid- to late-summer draw close to 50,000 buyers and vendors.

Contact reporter Tim O’Reiley at
toreiley@reviewjournal.com or 702-387-5290.

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