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Cash, Control Spats Meant No Bliss Here

How Hartford 21 lost its signature retail tenant

By SEAN O'LEARY, Hartford Business Journal Staff Writer

August 20, 2007

The pact to bring Wethersfield’s Bliss Market to downtown Hartford came nearly a year ago amid hoopla, cheers and fanfare. But almost from the very day of the announcement, the deal began its death spiral.

In the end, say the parties involved, what killed the partnership between Bliss and Northland Investment Corp. had much less to do with the state of Hartford’s downtown, and much more to do with out-of-control expenses and battling egos.

“We battled over money the entire time,” said John DeFrino, the owner of Bliss Market. “It was a pissing match all the way.”

It was 11 months ago that Northland Investment Corp. executives touted the arrival of Wethersfield’s Bliss Market to anchor retail at the new tower and provide a downtown grocery store and a café in the 7,000 square-foot storefront. The niche market was supposed to open its doors this past March.

And the deal was viewed as a smart marketing move by Northland CEO Lawrence Gottesdiener. Convinced that a downtown market was crucial to his company’s attempts to fill its new luxury apartments, Gottesdiener agreed to underwrite the costs of bringing in a downtown grocer.

But DeFrino now says Gottesdiener didn’t go far enough with that commitment.

“I was going to incur a lot of debt and I didn’t feel like it was worth it,” said DeFrino. “Northland was willing to finance it, but you can finance anything and at the end of the week I still have bills to pay.”

The original deal had Northland covering the costs for the first $1 million to build out the space with Bliss Market covering lease equipment and overrun costs. Quickly, though, the cost of the project ballooned to $2 million.

“The deal was for $1 million, then it went over-budget and they wanted to split some of that cost,” said DeFrino. “I don’t think that was fair or going to work, but that’s their deal.”

DeFrino said the design of the grocery store was his idea but Northland hired a contractor to do the elevations and they “screwed up badly.”

“They screwed up with the kitchen, they screwed up to the point we were out in the Civic Center parking lot taking up three spaces,” he said. “They wanted to whack me for that and it just got frustrating.”

The fiscal parameters of the project obviously played a large role in the deal falling apart, but Northland spokesman Chuck Coursey asserted the company was always willing to help.

“When it came out to $2 million, Northland agreed to eat some of that, a large portion of that,” said Coursey. “Once it got to $2 million, it was clear that [Bliss] would be unable to meet their financial commitments. That’s all we’re going to say about that.”

Time Slips By

Although the project was slated to open March 1, the design problems and the fights over money made that timetable impossible.

March came and went and the market didn’t open. So did April, May and a few others as the space remained under construction.

By July, however, DeFrino had enough and asked for his release from the 10-year lease signed last year. Last week, both sides finally went public with the news that their compact was finished.

But the market isn’t. With more than $1 million of its money already tied up in the project’s build-out, Northland says it intends to complete construction at its own expense. Northland, in effect, will suddenly become a grocery store operator in addition to real estate developer.

Coursey said Northland is looking to hire managers and employees to run the store, which it wants to open in November. Yet he acknowledged that the shop so far has no name, and that it’s product selection will likely simply mirror what Bliss was planning to do.

“We have had serious discussions to operate the market and we’re very pleased with those discussions,” said Coursey. “We’re moving forward and we’re very confident that we will have an upscale market to further the retail and restaurant business downtown.”

“All we’re missing right now is who’s going to run the market, and I’m very confident we will do that,” Coursey said. “There will be a market downtown, it just won’t say Bliss Market. That’s the only difference.”

No Offer

But even as their deal finally broke apart, DeFrino said he was surprised to hear Northland’s intentions to fund 100 percent of construction costs as well as rent the space when the store is open. No such deal was ever on the table for him, he charged.

“If that was the case months ago, if that was the case a week ago, we’d still be there,” he said. “I don’t know how to explain it, that’s [Northland CEO Larry Gottesdiener]’s cake.”

DeFrino said he has not soured on Hartford and would still open a market downtown if the situation was right.

“With my kind of market and how we run it, we definitely could be successful,” he said. “Do I think [a different] supermarket would be successful [at Hartford 21]? No.”

There have already been inquiries from other downtown businesses about getting a Bliss Market, DeFrino said, though he declined to mention specifics.

“We’ve had calls and we’ll see what the options are,” he said. “We have booked catering for the next four months at Hartford 21. And I’ve been called by some people that are [expletive] pissed off by this.”

Reprinted with permission of the Hartford Business Journal. To view other stories on this topic, search the Hartford Business Journal Archives at http://www.hartfordbusiness.com/archives.php.
| Last update: September 25, 2012 |
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