Shopping Center Owner Files Lawsuit Against Ukrop's; Wants to Buy Shuttered Grocery Store

By Desiree Parker Wednesday, August 25, 2010

 

Ukrop’s and two other companies are facing a $2 million lawsuit by a disgruntled adjacent property owner.

 

Texas-based American General Life Insurance Company (AGL) claims it should be allowed to purchase the former Ukrop’s location on Mooretown Road before the property goes up for auction in September. AGL filed the civil suit earlier this month in York-Poquoson Circuit Court.

AGL bought the shopping center attached to the former Ukrop’s location on Mooretown Road this past June for $7 million (the previous purchase price in 2008 was $23.78 million), and the company says the previous owners signed an operation and easement agreement with Ukrop’s that gives the neighboring owner six months to buy the store if it stopped functioning as a grocery store for 12 consecutive months.

Ukrop’s now has the property and all the interior equipment up for auction September 21, and AGL wants the court to enforce the agreement to allow them repurchase rights, appoint a special commissioner to make the sale and execute the deed, stop the pending auction and pay $2 million in damages and associated costs.

AGL says Ukrop’s is not cooperating, and has not responded to its request to have the property’s commercial value appraised so AGL can make the offer. According to the operation and easement agreement, a copy of which was filed in court, AGL’s deadline to exercise an option to buy the store was the end of July this year. Copies of AGL’s letters to Ukrop's, which on July 23 made clear the company's intention to purchase the Ukrop's building, were also included in the court filing.

The grocery store opened in October of 2006 and closed in January 2009 due to sluggish sales. The site has sat vacant ever since, with the location’s fate up in the air after Ukrop’s sold its functioning stores to Martin’s in December 2009.

In the suit filed August 13 in York-Poquoson Circuit Court, AGL names Ukrop’s and also Grafe Auction Company, the business holding the auction of the Ukrop’s location.

Grafe is offering the entire location and contents for $850,000 online, reduced from $990,000, with an option to purchase the site for the offer price by September 10. On September 21, the property and contents will be auctioned on-site, which AGL argues is not legal.

Also named in the suit in a later filing is the company Supermarket Equipment Sales, LLC, which bought interest in the fixtures and other equipment this summer. AGL discovered SES had an interest in the location when the SES owner contacted AGL in August, after AGL filed the lawsuit against Ukrop's and Grafe.

The injunction hearing is set for September 2.