Asana Sues Cheesecake Factory Subsidiary Over Broken West Midtown Lease
A subsidiary of The Cheesecake Factory has been hit with a $2.7M lawsuit over the sudden closure of a large restaurant in the Brickworks redevelopment.
Asana Partners filed a lawsuit in Fulton County Superior Court on April 14 against an affiliate of Phoenix-based Fox Restaurant Concepts after it shuttered the Culinary Dropout eatery in January. The suit says Asana is owed millions in unpaid rent and build-out costs.
The lawsuit names CDO Holding Co. LLC, which is registered to Fox Restaurant Concepts, as a defendant, claiming it guaranteed the 11-year lease for nearly 12K SF at 1000 Marietta St. FRC founder Sam Fox signed the guarantee for the lease, which was filed as an exhibit in the lawsuit.
Culinary Dropout signed the lease in October 2021, opened in fall 2023 and closed Jan. 15, one of nearly a dozen restaurants to fold in West Midtown in recent months.
Asana, which is being represented by Arnall Golden Gregory attorneys Knox Withers and Kelsey O’Neill, claims FRC owes nearly $2.7M, including nearly $1.9M for unamortized tenant improvement allowances and $463K in leasing commissions. Culinary Dropout owes $50K a month for the lease, which will continue to accrue and includes escalation clauses, the lawsuit says.
“Tenant breached the lease by ceasing its business operations in the premises and by failing to pay certain monetary charges when they became due that are tenant’s obligations under the lease,” the suit says.
FRC hadn't filed an answer to the lawsuit as of press time, nor did it or The Cheesecake Factory return messages seeking comment. Asana Managing Partner Terry Brown declined to comment.
In addition to Culinary Dropout, Ford Fry’s Superica, Postino WineCafe, West Egg Cafe, Humble Pie and Snooze A.M. Eatery have all called it quits since the start of 2024 in what has been one of the hottest foodie destinations in Metro Atlanta.
Expensive parking, high rents and fewer-than-expected office workers have all contributed to the struggles for eateries in the area, Bisnow previously reported.
“Rents are too high, the population is too low, and parking is tough. I think a lot of landlords are signing leases for the sake of signing leases,” Peter Kruskamp, president of retail brokerage The Shumacher Group, previously told Bisnow.
Charlotte-based Asana, in a Jan. 13 letter sent from AGG to Culinary Dropout and filed with the suit, demanded that the restaurant operator send it recent financial statements. It was unclear if FRC complied.
FRC, which also owns restaurant chains Flower Child, Zinburger and The Arrogant Butcher, should be required to pay the difference in rents if Asana leases its space to a new tenant for less than what Culinary Dropout was paying, the suit says.
FRC continues to operate a Culinary Dropout in Dunwoody.
The Cheesecake Factory purchased FRC in 2019 for more than $350M. The chain acts as Cheesecake Factory’s “incubation engine, innovating new food, dining and hospitality experiences to create fresh, exciting concepts,” the company said on its website. In 2024, FRC reported full-year sales of $6.4M per location, or around $1,100 per SF.
