Ala Moana Center and Shirokiya terminate lease in legal battle

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Ala Moana Center and Shirokiya are in the middle of a legal battle with millions of dollars at stake. On Monday a judge gave the go ahead for Shirokiya operators to enter the property and remove items left behind, including hundreds of thousands of dollars worth of wine.

Ala Moana Center’s parent company is suing Shirokiya Holdings Inc. for millions of dollars for alleged back rent. Shirokiya’s lawyers counter sued for even more.

A judge is giving Shirokiya operators until Aug. 15 to remove liquor and personal effects from inside the Japan Village Walk and Vintage Cave Cafe.

Lawyers representing Shirokiya Holdings Inc. argue it was unlawful for Ala Moana Center to lock out its vendors over alleged back rent, and while doing so, also locking up more than $200,000 worth of fine wine belonging to members of its Vintage Cave Club.

Former Hawaii Attorney General Doug Chin said this case is not a surprise. These monetary disputes are aligned with the economic difficulties brought by the pandemic.

“One side will be saying you unlawfully took possession of my liquor and my possessions,” Chin said. “The other side will be saying, no absolutely had a right to do that, the judge is basically saying I am going to put that issue to the side and get you simply to talk about what’s the best way to get this resolved.”

The judge ordered the case into mediation.

Lawyers for Ala Moana Center filed a complaint against Shirokiya Holdings Inc. on Jan.15. The lawsuit claims nearly $8 million in past due rent.

In a counterclaim, Shirokiya said it was impossible for its businesses to pay rent after being forced to close due to COVID-19. It responded by suing Ala Moana Center for $110 million. Lawyers claimed $50 million is for costs for renovations during its move to the Ewa side of the mall, and $60 million in loss of future profits.

“This is a situation where you have a landlord that’s saying, ‘Look you didn’t pay rent. You are not keeping up with your end of the bargain,'” Chin said. “The tenant is pushing back in saying, ‘You did not give us every opportunity to succeed, like maybe we talked about when we were signing the lease.'” 

Ala Moana Center Vice President and Senior General Manager Jake Wilson in a statement said:

Shirokiya closed for business at Ala Moana Center in 2020 and the lease was terminated earlier this year. While we do not publicly discuss details of any of our tenant leases, or reasons for termination, the decision to bring suit was not taken lightly and is the result of many months of discussions while trying to come up with a resolution.

Last year was a difficult year for all retailers across the board and we took extraordinary measures to support our tenants to help them remain in business. It is unfortunate that Shirokiya made the decision not to remain in operation.

We are in preliminary discussions regarding the future of the space and we look forward to sharing our plans in the coming months.

The judge said Ala Moana Center can observe but not obstruct as Shirokiya removes its belongings.

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