The building at 240 St. Paul St. in Denver was developed by BMC Investments, led by CEO Matt Joblon. (BusinessDen photo illustration)
The decision by a prospective anchor tenant to bolt from a Cherry Creek office building last year was the genesis of a legal dispute between the building’s owner and a local broker.
At 240 St. Paul St. sits a six-story building developed by BMC Investments, of Denver. In 2019, BMC was approached by Tributary Real Estate, which was representing Equinox Fitness Clubs, a high-end gym chain. Tributary suggested Equinox as a tenant and Equinox signed a lease.
Tributary then sent an invoice to BMC for $328,210 — or $10 for each of the 32,821 square feet that Equinox was to occupy — according to a lawsuit BMC filed Oct. 10. BMC paid its bill but now claims that “Tributary’s invoice was misleading and false on its face.”
BMC said that under their agreement, Tributary was to be paid half of that $328,210 when the project broke ground and half when Equinox moved in, not the full amount up front.
240 St. Paul St. was completed in 2021 but Equinox never moved in. Matt Joblon, the CEO of BMC, told BusinessDen last year that Equinox wanted more time to build its two-story gym there than BMC preferred, so the two sides amicably agreed to terminate the lease. BMC then sold the building to Denver-based Gart Properties for $69 million in mid-2022.
Meanwhile, BMC said that it can’t get back the money it is owed from Tributary.
“(Tributary) has refused to make payment of the $164,105, wrongfully withheld those proceeds and stated that (BMC) needed to sue it for the proceeds,” BMC’s lawsuit states.
Tributary’s managing broker Andy Cullen defended his firm in a statement two days later.
“This appears to be related to a standard 2019 lease transaction and a commission that was paid in 2020,” he said. “The building owner is now asking us to return part of the commission it paid us three years ago, based on a series of alleged modifications to the lease made after our commission was paid and without our knowledge or involvement.
“We’re in the process of gathering the necessary information and will respond accordingly once that has been collected.”
In addition to breach of contract and unjust enrichment, BMC is suing Tributary for civil theft. That is noteworthy because civil theft is punishable by monetary damages that are three times the amount taken, or about $500,000 in this case, plus attorney fees and costs.
BMC is represented by attorneys Peter Koclanes and Nicholas DeWeese in the Denver office of Sherman & Howard. They and Joblon did not answer requests for comment.
The Tributary case is one of two that Joblon — Cherry Creek’s preeminent developer — is involved in. He is also suing, and being sued by, the founders of Aviano Coffee. Joblon said they ignored his right of first offer at 244 Detroit St.; they say he wrongly interfered with their plans to buy it. A two-week trial is scheduled for July 2024 in Denver District Court.
Correction: A previous version of this story misstated the side of the transaction represented by Tributary Real Estate. The firm represented the tenant Equinox.
The building at 240 St. Paul St. in Denver was developed by BMC Investments, led by CEO Matt Joblon. (BusinessDen photo illustration)
The decision by a prospective anchor tenant to bolt from a Cherry Creek office building last year was the genesis of a legal dispute between the building’s owner and a local broker.
At 240 St. Paul St. sits a six-story building developed by BMC Investments, of Denver. In 2019, BMC was approached by Tributary Real Estate, which was representing Equinox Fitness Clubs, a high-end gym chain. Tributary suggested Equinox as a tenant and Equinox signed a lease.
Tributary then sent an invoice to BMC for $328,210 — or $10 for each of the 32,821 square feet that Equinox was to occupy — according to a lawsuit BMC filed Oct. 10. BMC paid its bill but now claims that “Tributary’s invoice was misleading and false on its face.”
BMC said that under their agreement, Tributary was to be paid half of that $328,210 when the project broke ground and half when Equinox moved in, not the full amount up front.
240 St. Paul St. was completed in 2021 but Equinox never moved in. Matt Joblon, the CEO of BMC, told BusinessDen last year that Equinox wanted more time to build its two-story gym there than BMC preferred, so the two sides amicably agreed to terminate the lease. BMC then sold the building to Denver-based Gart Properties for $69 million in mid-2022.
Meanwhile, BMC said that it can’t get back the money it is owed from Tributary.
“(Tributary) has refused to make payment of the $164,105, wrongfully withheld those proceeds and stated that (BMC) needed to sue it for the proceeds,” BMC’s lawsuit states.
Tributary’s managing broker Andy Cullen defended his firm in a statement two days later.
“This appears to be related to a standard 2019 lease transaction and a commission that was paid in 2020,” he said. “The building owner is now asking us to return part of the commission it paid us three years ago, based on a series of alleged modifications to the lease made after our commission was paid and without our knowledge or involvement.
“We’re in the process of gathering the necessary information and will respond accordingly once that has been collected.”
In addition to breach of contract and unjust enrichment, BMC is suing Tributary for civil theft. That is noteworthy because civil theft is punishable by monetary damages that are three times the amount taken, or about $500,000 in this case, plus attorney fees and costs.
BMC is represented by attorneys Peter Koclanes and Nicholas DeWeese in the Denver office of Sherman & Howard. They and Joblon did not answer requests for comment.
The Tributary case is one of two that Joblon — Cherry Creek’s preeminent developer — is involved in. He is also suing, and being sued by, the founders of Aviano Coffee. Joblon said they ignored his right of first offer at 244 Detroit St.; they say he wrongly interfered with their plans to buy it. A two-week trial is scheduled for July 2024 in Denver District Court.
Correction: A previous version of this story misstated the side of the transaction represented by Tributary Real Estate. The firm represented the tenant Equinox.
