City Officials are Stepping in to Try to Save Club Deluxe
The closing of Club Deluxe has rattled everyone this past couple of weeks. The closure has felt absolutely devastating for all of us. The loss of this club will forever change The Haight and The City. Now that we’re past the shock of the announcement, we’re learning that there is a messy relationship between Deluxe and their landlords that is seemingly starting to spill over into a very public online forum.
To catch you up, Club Deluxe announced earlier this month, via a letter to their musicians, that they were closing their doors after 33 years. In the letter, the owner Sarah Wilde said,“It is with sadness, and a hint of disbelief that I must let you know Deluxe will be closing. Please allow me to say, I have done everything I can. We do not need a GoFundMe. We need the multi-billion-dollar real estate company that owns our building, to allow a fraction of their portfolio to remain occupied by small businesses, artists, the unsigned musician, the carpenter, the waitress, and the single parent.”
Club Deluxe has officially been added to a list of irreplaceable landmarks in San Francisco that have been pushed out by financial woes or terrible landlords such as The Stud, Slims, and more and more and more. The list feels like it just gets longer. An empty storefront joins the others just down the street. We always feel these losses and we often feel defeated. Is it the landlord? Who is to blame?
A few days ago, the landlords put out a statement of their own. Published in the SFStandard, their version speaks to a more complicated situation than what Wilde had outlined in her letter to musicians. It paints a picture that suggests Wilde was offered a solution by the landlords but didn’t take it. “Correspondence and documents provided by Veritas show the company offering a new lease and back-rent relief,” says the SFStandard. However, this wasn’t able to be verified independently. Wilde responded to their landlord’s claims saying “a false representation of the situation on multiple levels.”
There are multiple examples of why we might not be able to trust statements from Club Deluxe’s landlord, Veritas Investments. There are many times when they have wronged their tenants or been dishonest. Despite being one of SF’s biggest landlords, Veritas received a PPP Small business loan and exploited Gavin Newsom’s bailout exploiting Gavin Newsom’s $5.2 billion landlord bailout which helped them scoop up rent-controlled properties across the city from struggling mom-n-pop owners. They’ve also been called out for harassing tenants. They even faced a tenant’s debt strike revolt just last year in 2021 as well.
Jeff Jerden, chief operating officer at Veritas, said in an emailed statement to SFStandard that they have been trying to negotiate a deal with Club Deluxe since March of last year. This would have included forgiveness of $200,000 in back rent and a reduction in their rent.
“’Despite the owner’s unwillingness to engage in meaningful negotiations, we have not initiated eviction,” Jerden’s statement said. “To the contrary, this new lease would have allowed Club Deluxe to remain in their space through at least 2027.’”
We’ have not been able to see this lease so we can’t corroborate how fair it actually is.
We haven’t been able to get ahold of Wilde for her side of the story, but we’ve heard that a published letter from the landlord’s attorney dated July 19 demands about $285,000 in back-due rent and only gave the club until the 31st to send in the money. While they don’t say there will be an immediate eviction within the letter, finding nearly $300,000 within a couple of weeks isn’t something most small businesses can find easily. As Wilde says in her original letter to the club’s musicians:
“We simply cannot be held to the same leases as multimillion dollar companies; we do not have real estate assets to put up as collateral or inflated tech salaries piling up in our accounts.”
Just yesterday, Club Deluxe did make a statement on their Facebook thanking their fans for all of their support through this ugly transition and sad closing. In the same note, they also made a statement directly to their landlord.
“Dear friends, Thank you for loving Deluxe so much. Please come out, and bring your support for the staff and musicians. It’s going to be a fantastic evening! Dear landlord, You can bring your lawyers, your lawsuits, your unfair leases, your lies, your floods and your fury. You can not stop the music.”
Our source at Housing Rights Committee of San Francisco (HRCSF), Lenea Maibaum told us that Veritas Investments “Owns close to 300 buildings alone in SF and they are all rent controlled with some are commercial units.” Maibaum also let us know that Wilde did contact their committee hoping to get some help connecting with their landlord. This suggests that Veritas wasn’t as cooperative as the SFStanard article suggests. “Housing Right Committee of SF got a call from a merchant tenant needing some advice and direction and also wanting to know more about the Veritas Tenants Association. The merchant tenant was having issues in their establishment and was having a hard time getting a hold of the landlord.”
What will happen next? We all feel we can do is brace ourselves for yet another huge loss.
So many of us look at this type of issue and we try to tell ourselves it’s just part of a changing city; an international city that will inevitably have natural shifts and changes. However, this time it feels like people are even more gutted by the loss of Club Deluxe.
“I literally CAN’T with this deeply sad news. Where is the arts & culture advocacy?! They’ll protect t-shirt shops on Haight, but not THIS VENUE?! I’m rageful. It’s a TOTALY essential culture, one of the few local, jazz gems, and part of what makes up the heart of Upper Haight. It MUST be saved!” said Paul in response to our original article on the closure.
And the musicians who play at the space (of which there are over 40 listed) wonder – why does this have to happen to another iconic venue like Club Deluxe? “When a city is flushed with cash, like SF, you can save culture if you WANT to.” says musician Cathy Lemons of The Lucky Losers.
As far as how you can help Club Deluxe? Hoodline and the SFChronicle are suggesting that all may not be lost in this situation. Club Deluxe has been around for 33 years. Supervisor Dean Preston tweeted, “I’m in discussions with both the owner & the landlord to encourage lease negotiations that had broken down to resume. Hoping to find a path forward for this beloved venue.”
We’re hoping that, if there are truly discussions happening, they go a bit smoother than the past talks between Club Deluxe and their landlords. In the meantime, keep supporting the club, the staff, and musicians as they navigate the unknown future. According to their website, Deluxe is planning on having live music events through August.