NASHUA – Multiple small business are now caught in the crossfire of a lease dispute involving a local entrepreneur and city leaders regarding a parking lot in which officials plan to install metered parking in the area of the Pine Street Extension.

Stephen Bonnette of Riverside Properties of Nashua Inc., which owns the two buildings at 3 and 5 Pine St. Ext. has been leasing this lot for 10 years. Customers going to businesses at both structures use the lot.

Bonnette maintains that when he signed a lease with city officials in December 2009 for use of this parking lot, he was under the impression Riverside would have the right to purchase the property.

He said another right included in that agreement allowed him to extend the lease for five years.

However, the lease expired Dec. 13. Now, customers may have to pay 50 cents per hour to park in this lot, or pay $50 a month for a parking permit.

“None of this really seems right,” Bonnette said.

On Monday, business owners were surprised when they noticed city signs notifying the public of the change.

Lease Dispute

Bonnette’s attorney, Arthur Gormley, wrote a letter dated Dec. 5 to Nashua Board of Aldermen President Lori Wilshire.

“…The city’s intent to use the land for municipal parking is a clear breach of the lease entitling Riverside to damages. It also appears that the city is violating its contractual obligation to conduct itself in good faith when dealing with Riverside,” the letter states.

According to the document, at the time of this lease agreement, part of the property leased was 50% vacant and unpaved, with the remainder of the lot offering 53 paved parking spaces. Bonnette maintains Riverside spent more than $150,000 to develop the parking lot and create additional parking spaces to serve the two commercial buildings he owns at this location, which was necessary for Riverside to obtain land use approvals for the leasing of the commercial buildings.

Nashua Director of Economic Development Tim Cummings said Bonnette will not be reimbursed for his costs.

“Riverside Properties received a substantially reduced rate over the last 10 years with the understanding it would mitigate these costs,” Cummings told The Telegraph via email.

However, Cummings also said this is not a new issue, and that city officials has been trying to work with Riverside to resolve the issue. An email sent to Bonnette from Cummings regarding the matter was included in Cummings’ response to questions on the matter, which was dated March 28, 2017, to show the date of when he and Bonnette began discussing the topic.

Cummings said he has reached out to Bonnette personally on a couple of occasions with phone calls, emails and a letter in advance of the lease expiring.

“Mr. Bonnette has not expressed an interest in working with the city unless it is on the terms as outlined in the now expired lease,” Cummings said via email.

The city has offered to lease spaces to Bonnette since the city is no longer interested in selling the parking lot, which Cummings said he believes was offered to Bonnette for sale a few years ago.

“It is also my understand he rejected the offering,” Cummings said via email.

According to the letter Gormley sent to city officials, “It is my understanding that in May of 2013, prior to a lease extension, the parties were negotiating a purchase and sale, but the city failed to provide environmental information concerning the demolition of a building at the property. As such, there was an inability to agree on a price. Finally, the lease provided that it could not be terminated by the city if it intended to use the improved lot for municipal parking.”

Later in that letter, it states, “Also be advised that the city cannot terminate the lease because it ‘expired.’ In fact, New Hampshire case law provides that a lease cannot be terminated solely for the reason that it is ending, rather, there must be other good cause.”

Bonnette said his company would have never invested so much into the lot without the belief it could be purchased.

On Wednesday, Bonnette said he is interested in purchasing the parking lot, but Cummings said the city is not interested in making that sale.

Beyond spending money developing the parking lot, Riverside also spent more than $2 million renovating the former mill buildings.

“We have hundreds of thousands of square feet, and now no legitimate parking,” Bonnette said. “Nobody wants to pay meters in the middle of a thing like that. They’re just completely tanking my business by doing this. I can’t even begin to tell you what their motivation is.”

City officials provided Riverside with written notice on Sept. 5 that the lease would expire on Dec. 13, and that the city intends to use the leased property for municipal parking. Gormley’s letter sent to Wilshire states, “This would result in yearly rent (if the parties were to monthly renew the agreement which could be at the city’s discretion) of $100,200. The present rent is $33,000 per year.”

“It will require legislation by the Board of Aldermen,” Nashua Corporation Counsel Steve Bolton said. “We’re coming to the end of the term, so I would expect something to probably be introduced in January, maybe even as late as February.”

He is aware of Gormley contacting the city. However, the parties involved have not reached agreeable terms.

“Mr. Bonnette has indicated he is going to file suit against the city, which unfortunately caused us to take active measures to show we are taking proactive steps in taking back possession of the property,” Cummings said via email.

In his email, Cummings said now that the lease has expired, city officials will be looking to proactively communicate directly to those using the parking lot. One of the ways to do this is to have a meeting with business owners in that area.

In the meantime, Bonnette said he has contacted Cummings numerous times, and has also spoken to Mayor Jim Donchess about the matter. In addition, Bonnette said he has engaged in multiple meetings with some BOA members.

“We’ve talked it over – there just seems to be no wiggle. They’re just saying, ‘Tough, you spent all this money, tough luck, we’re taking it,'” Bonnette said.

Bonnette also has concerns about losing tenants because of the parking meters. He said he does not know what is going to happen, but is still interested in purchasing the lot.

Impact On Businesses

As Bonnette and his attorney face down city officials, those who lease space in his buildings are also concerned for their futures.

“The city has been, I call it, very shady – taking over,” Studio L Photographers owner Jennifer Lamerand said. “They are just sneaking in to take over the lot.”

Her business is inside Bonnette’s building at 5 Pine St. Ext. Lamerand she learned of this entire situation Monday when she pulled up to park and saw the signs. She also received flyers on the windshield of her vehicle. During the past few weeks, she has noticed city trucks in the lot, and poles being installed. At that time, she was wondering what was happening.

“The only people that use this lot are the small businesses in this building,” Lamerand said. “Most days, it is empty.”

If she were to purchase a parking permit, she said it would add an additional $600 annual cost to her business. Her business operates via appointments, and she said her clients should not have to pay the city to see her in her photography studio. She wonders if her clients will ask her to validate their parking and if she will have to pick up the tab.

If these metered spaces do go in, Lamerand said she will likely change her business and only be in her studio when she has photography sessions of meetings with clients. Any photo editing would be done at her home, she said.

Emily Chapdelaine is the owner of Studio Em, also located inside 5 Pine St. Ext. She is also unhappy about this development.

“I don’t really know how it’s going to go forward, but it’s definitely a big stressor for me right now and something I’m definitely concerned about,” Chapdelaine said.

When she started her business at this building, one of the main motivations was the available parking. Chapdelaine also said that is why she does not rent a place on Main Street.

“I don’t understand why they even think they’re going to generate a lot of income over here, unless there’s something else going on that we all don’t know about and they have a bigger plan for this area,” Lamerand added.

Adam Urquhart may be contacted at 594-1206, or at aurquhart@nashuatelegraph.com.