End of the road for longtime San Mateo businesses

“I fixed it up, I built the clientele here … this is the business I support my family with,” Jamal Hemeidan said, who purchased The Zone in 2015.

The stores operated on the block, on the south side of Third Avenue between Delaware and Claremont streets just east of the train tracks, since 1995, and Hemeidan said that because of tightened tobacco retail rules in the city, he’s been unable to find a place to move.

“This is a grandfathered store, I can’t get a permit to go anywhere else,” he said.

Next door neighbor Jaybirds, a store that sells adult items and offers private booths for porn viewing, finds itself in a similar predicament. The store will close for good in coming weeks, owner Russell Friedlander said, who cited lack of funds to move, and also pointed to permitting rules that would likely be a hindrance.

Friedlander said his store, which had operated at the location for more than 40 years, had similarly been exempted from new rules. “We will miss the community of San Mateo,” he said in an email.

Squires & Corrie Slot Machines, meanwhile, a San Mateo institution of more than 45 years specializing in restoring vintage slot machines, is already in the process of moving its vast inventory of assorted small parts, specialized tooling and collections of dusty gambling machines to Stockton.

Fred Mendoza, an employee of the shop since 1978, said the move will allow the cramped shop to spread into a larger space. The niche store already serves customers nationwide, he said.

For Las Palomas Taqueria, however, which opened in the ’70s, the future is less clear. Alberto Reyes, whose wife purchased the restaurant 10 years ago, said he’s looked for another location in San Mateo but hasn’t found anything suitable. He said the best they’ve been able to find so far wants nearly triple the restaurant’s current $750 monthly rent.

“There’s no more space for us,” he said.

Others on the block, which appear to have already closed, include ShineMore Hair Design salon, Guatemalan eatery Restaurante Aminta, Taqueria Las Cazuelas, and check cashing store Check Expert. The block also contains an Arco gas station and smog center, and several homes that were recently boarded up and fenced off.

Lease dispute litigation

According to Mike Fields, a representative of Windy Hill property ventures, the developer for the new project, all 40 property owners on the block have agreed to sell.

But not all tenants are leaving without a fight. Hemeidan said he, together with the owner of Wing Fat, which opened on the block in 1962, entered into a lawsuit against their landlord this month, alleging their long-term leases were prematurely broken or unfairly overridden.

Hemeidan said he was asked to leave by the end of July, despite five years remaining on his lease. He said he was first offered $20,000 to leave, then $100,000 when negotiations began to sour, a sum he said was still not adequate given the losses he’s facing.

“They gave me 30 days to kick me out, while I have a legit lease, the tactic was nasty,” he said. “So now I have to hire a lawyer.”

The parcel containing The Zone, Wing Fat, Jaybirds, Las Palomas Taqueria and ShineMore Hair Design, one of 11 parcels that make up the block, is owned by Elenor Kun Lee, according to the county Assessor’s Office, which did not yet have a record of a completed sale for the property.

Hemeidan said his point of contact has been Walter Lee, who is also named in the complaint filed June 17. Walter Lee and his attorney did not return calls for comment.

According to the complaint, both Hemeidan and Yan Er Zheng, who operates Wing Fat, signed a six-year lease in late 2020. It alleges Hemeidan and Zheng were later asked to sign a one-year lease. Hemeidan refused, but Zheng, who was told the lease needed to be “redone,” signed on for the shorter term, unaware the six-year lease was legally valid, the complaint states.

It also alleges Hemeidan requested $1.5 million to terminate his lease, to which Walter Lee said if the $100,000 was not accepted, “things would end badly” for Hemeidan.

The new project, dubbed ‘Block 21,” is set to rise six stories with 111 apartments, 12 of which would be affordable to “very low income” residents ($1,598 monthly for a studio, $1,713 for a one-bedroom, and $2,056 for a two-bedroom). Also included will be 180,000 square feet of offices. The project was given the green light by the city June 20.

Across the street closer to the tracks, a similar office and apartment building, also by Windy Hill, was recently completed. That development, approved in 2019, did not include a property on the block housing restaurants Saigon City and Fuji Sukiyaki, which the completed building today wraps around.

corey@smdailyjournal.com

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