Mayo Island owners sue VCU over parking lot lease dispute

Mayo Island, pictured on the far side of the river, has hit the market for $19 million. (BizSense file)

Weeks after it was listed for sale at $19 million, Mayo Island and its owners are wrapped up in a legal dispute with Virginia Commonwealth University that centers on a parking lease, a bus shelter and an apparent city permitting delay that may have set the whole thing off.

Earlier this month Mayo Island’s ownership group filed a lawsuit against VCU, alleging that the university hasn’t paid its $24,000-per-month parking lot lease on the island in nearly a year. VCU has rented the lot on the nearly 15-acre plot since 2014.

Mayo’s Island L.C., an entity tied to Fred Shaia, owns Mayo Island and is the plaintiff in the case. It seeks $240,000 in damages, the amount it claims VCU owes for 10 months of back rent, as well as interest and attorney’s fees. The state comptroller and Attorney General of Virginia are also named as defendants in the suit.

VCU’s lease on the parking lot on Mayo Island expired at the end of April. However, the suit alleges that it had attempted to terminate the lease last year due to a supposed failure by the landlord to meet certain lease terms.

The main term in question is a clause that was allegedly added to the lease in 2019 regarding a bus shelter on the premises. The ownership group allegedly needed to receive permits from the city to install the bus shelter, but VCU claims the landlord violated the lease term by not obtaining the permit.

However, the Mayo Island group claims it was unable to receive the permits in question because it didn’t receive a response from the city for nearly two years and it came after VCU sought to terminate the lease in April 2021.

A bus shelter lies at the heart of the legal dispute between Mayo Island’s owner and VCU. (Mike Platania photo)

“VCU is not able to exercise the termination clause … because the plaintiff did file with the City of Richmond to obtain the proper permits,” the suit states. “The City, through no fault or inaction by the plaintiff, did not give answer to that permit process until July 1, 2021.” The group claims it had last heard from the city in August 2019, according to the suit.

“The lack of any answer from the City of Richmond created (a) legal impossibility,” the suit states.

The suit states that the island’s owners ultimately completed the work without a permit and that “VCU did secure a bus shelter on the property” at an unspecified point in time, only to see it be removed by the university in July 2021.

VCU and the Attorney General’s office declined to comment, stating they could not comment on pending litigation. Thomas Shaia and Andrea Shaia Bade are representing Fred Shaia in the case and declined to comment.

A response had not been filed as of press time.

The island, which sits at 501 S. 14th St. between Manchester and downtown Richmond, was listed for sale earlier this spring with an asking price of $19 million. The Shaia family has owned the property since the 1980s. Most of the island is either undeveloped land or parking lots.

The family said last month that the listing was an effort to test the hot real estate market, prompted by the expected April end date of VCU’s lease.

The lawsuit marks at least the second time this year a parking lot has been at the heart of a local legal dispute. Two Scott’s Addition developers are currently entangled in a battle over a 51-spot lot.

 

Mayo Island, pictured on the far side of the river, has hit the market for $19 million. (BizSense file)

Weeks after it was listed for sale at $19 million, Mayo Island and its owners are wrapped up in a legal dispute with Virginia Commonwealth University that centers on a parking lease, a bus shelter and an apparent city permitting delay that may have set the whole thing off.

Earlier this month Mayo Island’s ownership group filed a lawsuit against VCU, alleging that the university hasn’t paid its $24,000-per-month parking lot lease on the island in nearly a year. VCU has rented the lot on the nearly 15-acre plot since 2014.

Mayo’s Island L.C., an entity tied to Fred Shaia, owns Mayo Island and is the plaintiff in the case. It seeks $240,000 in damages, the amount it claims VCU owes for 10 months of back rent, as well as interest and attorney’s fees. The state comptroller and Attorney General of Virginia are also named as defendants in the suit.

VCU’s lease on the parking lot on Mayo Island expired at the end of April. However, the suit alleges that it had attempted to terminate the lease last year due to a supposed failure by the landlord to meet certain lease terms.

The main term in question is a clause that was allegedly added to the lease in 2019 regarding a bus shelter on the premises. The ownership group allegedly needed to receive permits from the city to install the bus shelter, but VCU claims the landlord violated the lease term by not obtaining the permit.

However, the Mayo Island group claims it was unable to receive the permits in question because it didn’t receive a response from the city for nearly two years and it came after VCU sought to terminate the lease in April 2021.

A bus shelter lies at the heart of the legal dispute between Mayo Island’s owner and VCU. (Mike Platania photo)

“VCU is not able to exercise the termination clause … because the plaintiff did file with the City of Richmond to obtain the proper permits,” the suit states. “The City, through no fault or inaction by the plaintiff, did not give answer to that permit process until July 1, 2021.” The group claims it had last heard from the city in August 2019, according to the suit.

“The lack of any answer from the City of Richmond created (a) legal impossibility,” the suit states.

The suit states that the island’s owners ultimately completed the work without a permit and that “VCU did secure a bus shelter on the property” at an unspecified point in time, only to see it be removed by the university in July 2021.

VCU and the Attorney General’s office declined to comment, stating they could not comment on pending litigation. Thomas Shaia and Andrea Shaia Bade are representing Fred Shaia in the case and declined to comment.

A response had not been filed as of press time.

The island, which sits at 501 S. 14th St. between Manchester and downtown Richmond, was listed for sale earlier this spring with an asking price of $19 million. The Shaia family has owned the property since the 1980s. Most of the island is either undeveloped land or parking lots.

The family said last month that the listing was an effort to test the hot real estate market, prompted by the expected April end date of VCU’s lease.

The lawsuit marks at least the second time this year a parking lot has been at the heart of a local legal dispute. Two Scott’s Addition developers are currently entangled in a battle over a 51-spot lot.

 

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Brett Themore
Brett Themore
1 month ago

Sounds like the owner gave the tenant a bus shelter, which was than taken by the tenant. Sound like the owner is also due compensation for the stolen bus shelter, and the tenant should be charged with theft.

Frank Smith
Frank Smith
1 month ago

So, another goof-up by the City of Richmond, compounds the seriousness of the problem here. Isn’t it about time to broom-out the people that run the city, and welcome some folks who will be business friendly. Permit issues…geeeze.

John Lindner
John Lindner
1 month ago
Reply to  Frank Smith

You mean give them all a 10%-15% raise, right? 😉

Polgar Concertado
Polgar Concertado
1 month ago

I know it’s easy to blame the city, but did anyone from Mayo Island, L.C. ever follow up with the city during that 2 year period to see what was going on with the permit?

Nancy Waldman
Nancy Waldman
1 month ago

And that’s why, folks, when you get into a dispute over a contract involving payments, you put those payments into an escrow account until the legal terms are resolved and you know who owes what to whom.