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Toys “R” Us Canada is facing another lawsuit from a landlord that says it terminated the retailer’s lease after it failed to pay rent.
RioCan Holdings Inc. says in a new court filing that the toy store chain didn’t pay rent last month for a space it occupied at the Lawrence Allen Centre in Toronto.
After allegedly warning Toys “R” Us Canada on Jan. 5 that it would end its leases if the retailer didn’t make a payment within seven days, RioCan said in a court filing that it followed through with its threat on Jan. 20.
The claims have not been tested in court.
However, the unpaid rent allegations mirror claims contained in seven other lawsuits The Canadian Press reported last month had been filed against the retailer over the last year.
Asked for comment about the latest lawsuit, Toys “R” Us Canada spokesperson Allyson Banks said Monday in an email, “I do not have information to share on this topic.”
Stephanie Sallah, a RioCan spokesperson, said in an email that the company also couldn’t comment because the matter is before the court. The Lawrence Allen Centre website no longer lists the retailer as a tenant.
Toys “R” Us Canada had 81 stores when it was purchased alongside Babies “R” Us by Putman Investments in 2021. Its website now lists 40 stores. It’s unclear how many are actually in operation because media reports have suggested some listed have now been shuttered or have unpaid rent notices affixed to their doors.
Online listings show some of its properties have been put up for sale for as little as $1 and trailers, forklifts and other equipment from its Concord, Ont., headquarters were auctioned off just before Christmas.
The seven lawsuits reported last month amount to about $31.3 million in unpaid rent and other damages.
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Those claims have also not been tested in court and in many of the cases, Toys “R” Us Canada has not filed a statement of defence. Where it has responded, the company has largely denied the allegations of its suppliers and taken issue with the amount of money being demanded.
In the latest lawsuit against the company, RioCan is asking a court to force Toys “R” Us Canada to pay it about $4 million. That includes the missed January rent payment of roughly $43,000, plus millions in other obligations outlined in the toy store’s lease.
The commercial real estate company says the lease covered 15,580 square feet and was due to expire on Oct. 31, 2035.
It had a provision allowing the landlord to terminate the lease and demand three more months of rent, if Toys “R” Us Canada didn’t pay rent as scheduled and then didn’t remedy the situation within seven days of being notified, RioCan said in its court filing.
Interest would need to be covered on any unpaid rent, RioCan added.
Many of the leases at the heart of the seven other lawsuits Toys “R” Us Canada is facing have similar provisions, which were also used to terminate the retailer.
One of those lawsuits was filed by RioCan Holdings and affiliate RioTrin Properties, which accused Toys “R” Us Canada of not paying rent at Brentwood Village Mall in Calgary and RioCan Centre Belcourt in Orleans, Ont., respectively.
RioCan dropped the Brentwood claim recently but affiliate firm RioTrin is still pursuing the Belcourt allegations.
Toys “R” Us has asked for the Belcourt case to be dismissed and says it notified RioTrin in advance that the store would be closing and presented a potential replacement tenant to whom it could assign the leases.
RioTrin refused to assign the replacement tenant the leases, Toys “R” Us Canada said in its statement of defence.
Toys “R” Us Canada owner Putman Investments is based in Ancaster, Ont., and is also behind HMV, Sunrise Records, FYE, Ricki’s, Cleo and Northern Reflections. Over the holidays, it closed all of its T. Kettle stores and before that, shuttered a short-lived home goods venture called Rooms + Spaces.
Its sister company Everest Toys, started by the father of Putman Investments leader Doug Putman, was forced into receivership last year.
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