GRAND RAPIDS, Mich. (WOOD) — A Grand Rapids warehouse owner is suing Amazon after the retail giant allegedly backed out of leasing a facility it had already started demolishing.
New West Michigan III Industrial Investors filed the federal lawsuit Friday. The company is accusing Amazon of a $10 million breach of contract involving its warehouse at 3951 Trade Drive SE, located just east of Eastern Avenue, between 36th and 44th Streets.
In the court filing, NWM says Amazon negotiated for months to lease the facility as a regional distribution center.
During the process, NWM says Amazon signed an agreement that allowed it access to the building before signing a lease, with the stipulation that if no leasing deal was reached, Amazon must restore the building to its original condition at the time of the deal.
NWM said as leasing negotiations continued, Amazon pulled permits and hired contractors to update the warehouse. But on May 1, NWM says an Amazon representative told NWM they were terminating the deal because renovations were more than double what Amazon had budgeted.
NWM claims at that point, Amazon’s contractors were nearly halfway done with demolition, leaving the warehouse in a “deplorable” condition. NWM says the construction work went beyond what Amazon was allowed in the contract, and Amazon did not restore the property to its original condition within the 15-day period outlined in the agreement.
NWM says it cannot lease the facility in its current state and it will take $10 million or more to restore the building, based on a contractor’s estimate. NWM says in the meantime, it’s stuck with paying loans, insurance and utility bills for the property.
NWM says it also ended a lease agreement with an earlier tenant and paid them more than $20,000 for damage to their business caused by Amazon’s growing presence on the property.
The lawsuit accuses Amazon of breach of contract, negligence, gross negligence, common law conversion and statutory conversion.
News 8 reached out to Amazon for a response to the lawsuit and was told “Amazon has a longstanding practice of not commenting on pending litigation.”