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State liquor store landlords claim state improperly terminated leases

Post by John Gillie / The News Tribune on July 5, 2012 at 3:08 pm |
July 6, 2012 10:03 am

The owners of two shopping centers, one in Federal Way and the other in Spokane, claim the Washington State Liquor Control Board improperly terminated leases for their two liquor stores buildings when it quit selling liquor May 31.

That claim came in a lawsuit filed in Thurston County Superior Court by the limited liability corporations that own Fedway Marketplace and Garland and Market shopping centers.

The two real estate owners are seeking to expand the suit to include all owners of buildings formerly leased by the state for liquor store locations.

Under Initiative 1183 passed by voters last fall, the state exited the liquor business at the end of May. The state auctioned off the rights to its 167 liquor stores this spring to private operators.

Under the rules of that auction, the auction winners were guaranteed the rights to a license for a liquor store either at the same location as the state stores or within a mile’s radius if they were not able to negotiate a lease with the building owners.

The plaintiffs in the Thurston County suit contend the state could have required the winning bidders to assume the state leases or could have compensated the leased building’s owners for lost income and the cost of improvements they had made to the buildings to accommodate the state’s operations.

In many cases, the suit contends, the landlords failed to reach a lease agreement with the private liquor store owners or reached a deal that provided them less income than the state had been paying.

A liquor board spokesman was unavailable for comment Thursday.

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