An order of teriyaki chicken from Peter’s Oriental or a quiche and a coffee from Vintage Fare Cafe and Espresso used to be staples of a trip to the Nugget Mall.
But no longer: a busted sewer line has closed both shops down since early October and business owners fear the closure might be permanent. A legal battle between a company now in charge of the bankrupt Nugget Mall and the insurance company responsible for the property stands in the way of either restaurant reopening.
As employees leave and bills start to pile up, both the building manager and the business owners are left waiting for the legal system to play out. It’s time Pennie Peterson, owner of Vintage Fare Cafe &Espresso, said she doesn’t have.
“They can’t afford to fix the water at this time. The insurance company has paid for the first phase and they won’t pay for the second phase. I don’t know what’s going on,” Peterson said at a Wednesday interview at her shop.
Vintage Fare and Cafe has been Peterson’s “baby” for 15 years. She had a loyal roster of regulars and six employees ready to work the holiday season. It’s the time of year the shop makes a big chunk of its yearly revenue.
While holiday trappings decorate the mall, black plastic hangs over Vintage Fare storefront. Inside, an espresso machine lies dormant surrounded by kitchen implements and non-perishables.
The plumbing problems came on Oct. 2, just days before the first payouts from the Alaska Permanent Fund. The week marks the unofficial start of Vintage Fare’s important holiday shopping season. Instead of cash welling up in Peterson’s register, water welled up in her kitchen.
“On Oct. 2, my life changed,” Peterson said. “They called and said I had to close down immediately. My water was basically going through Peter’s and back up,” through the floor, Peterson said. “It’s plugged all the way down, somewhere in the hallway.”
Vintage Fare’s lease specifies that they have to have a working drain. Without one, the cafe had to close.
Peterson gave away her baked goods and perishables and washed her remaining dishes at a neighboring business. She moved all her equipment and furniture out of the shop and into an empty space in the mall, expecting work on the busted plumbing to begin soon.
But the plumbers never came. At first, Peterson would call in and talk to mall management every day. She said the only thing she ever heard was “we’re working on it.” After a few months, it got “depressing” to keep her hope up for so long.
Peterson is a self-described “planner” with 30 years experience in the restaurant industry. With the situation out of her hands, all she can do now is hope for change to come before her customers find a new favorite cafe.
Six months ago, Peterson was hoping to sell her business. Those plans have been put on hold until the plumbing gets fixed.
“I felt like I was at the end and ready to turn the page, but this isn’t how I expected to turn the page,” Peterson said.
Mall manager Elizabeth Clayton said she’d love to give Peterson a different answer but she doesn’t have one. In her office across from Vintage Fare, she said she too feels helpless to the situation. She’s been trying to spur the process along since October with no luck.
Clayton said she was expecting the mall’s insurance to pay for the repairs. The mall doesn’t have the hundreds of thousands of dollars it would take to repair the line, she said, and on top of that, both Vintage Fare and Peter’s Oriental would have to remodel their kitchens to existing code to reopen. That would make repairs somewhere in the neighborhood of $300,000.
As a Juneau-raised real estate agent, Clayton said it was “insane” to see a place like Peter’s Oriental closed. The restaurant has had a devoted fanbase, especially among young people, as long as she can remember.
Clayton can’t comment on what she knows about the insurance proceedings but did say mall management has offered to lease other spaces to both Peter’s Oriental and Vintage Fare and the mall isn’t currently charging them rent.
One of the problems is that the mall essentially doesn’t have an owner right now. The Nugget Mall went into receivership sometime in the last few years and is currently held by Washington-based company Resource Transition Consultants, LLC. Receivership is an alternative to bankruptcy which allows the receiving company to improve a property without becoming an owner of the property. It allows a company in financial trouble to forego expensive bankruptcy filings. It’s a process increasingly common for foreclosures. Resource Transition Consultants, LLC didn’t return phone calls from the Empire on Wednesday.
The mall is being sold by Seattle-based real estate brokerage firm Capital Pacific for $14,310,000. Capital Pacific employee Jack Navarra confirmed the sale by phone on Wednesday. Navarra wasn’t at his desk and couldn’t provide specifics of the sale but Capital Pacific has a presentation PDF available on its website.
There’s not yet a deadline to sell the property, Navarra said.
“It’s kind of a tricky transaction, a lot of moving parts,” Navarra said.
The Nugget Mall’s previous owners C.E. Loveless and Barclay Tollefson started their joint venture Loveless/Tollefson Properties to develop the Nugget Mall in 1972, court records show. Tollefson died in 2014, according to a Seattle Times obituary. Loveless is also deceased, according to Clayton. Family of the two founders now run the company.
It’s unclear whether Loveless/Tollefson is still active as a business entity. A website for Tollefson Properties shows a copyright dated to this year but calls to that company were not returned Wednesday.
• Contact reporter Kevin Gullufsen at 523-2228 or firstname.lastname@example.org. Follow him on Twitter at @KevinGullufsen.