Rosauers, U-City Mall In Dispute Over Sale Of Grocery Store Space
Rosauers Supermarkets, one of the original tenants of University City, is taking the shopping center to court.
Mall owners are negotiating to sell property at U-City to another grocery store operator. Rosauers filed a lawsuit in Spokane County Superior Court alleging such a deal violates a 1988 lease agreement between Rosauers and U-City.
Court documents show that U-City admits to negotiating a sale with an unnamed grocery store operator.
But U-City attorney John Magnuson claims the contract only forbids U-City from leasing space to another grocer, rather than forbidding a sale.
“The issue is fairly clear,” Magnuson said. “You could sell it to the man in the moon and they could turn it around and sell it (to another grocery store operator).”
Magnuson is the son of Harry Magnuson, one of U-City’s owners.
Rosauers attorney John Giesa did not return calls.
Larry Geller, president and chief executive officer of Rosauers, confirmed the nature of the suit but declined to comment.
Court documents show that Rosauers previously sought a temporary restraining order forbidding U-City from negotiating a lease or sale deal with any other grocery store operators. The request was filed May 17 and denied May 23.
Court documents show that Geller approached the mall’s owners late last year about building a new store at the mall. That would be contingent on U-City leasing the current Rosauers, located one block east, to a non-grocery tenant.
U-City rejected the proposal.
Rosauers operated a grocery store on the U-City site even before the mall opened in 1965. The Rosauers store at Sprague and University opened in 1959; that store became part of the shopping center when U-City was built adjacent to it. The store space at the east end of U-City has been vacant since Rosauers moved out of the mall in 1988.
The restraining order request filed by Rosauers mentioned that former site as one space the grocery store chain was trying to keep from being sold.
Though not part of the mall, the current Rosauers store near the shopping center is owned by U-City.
County records show a tentative court date has been set for February 1997.