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JERICHO, N.Y. -- Getty Realty Corp. said this morning it has increased its rent reserve funds by $11 million to counteract ongoing litigation brought forth by tenant, Getty Petroleum Marketing Inc. (GPMI).
As Convenience Store News Online reported on Sept. 23, GPMI accused Getty Realty of "failing to perform certain environmental remediation." GPMI added in a lawsuit that it planned to offset costs for necessary environmental remediation against its rent.
Although perhaps unrelated, the lawsuit followed news in August that Getty Realty said GPMI did not pay its rent on time.
Getty Realty CEO, President and Director David Driscoll repeated previous comments this morning during the company's conference when he said, "GPMI has no basis for its lawsuit."
As of today, Getty Realty said it had not received its November rent from the tenant. According to Driscoll, if the payment is not received by tomorrow morning, the rent would be considered late. However, by law, Getty Realty must wait 10 business days before it can exercise any remedy against GPMI, such as potential eviction.
In an effort to alleviate some of the rent burden GPMI has under its master lease, Getty Realty added that it is assisting its tenant in an attempt to sell several properties.
The litigation has also had an affect regarding Getty Realty's acquisition strategy. "We are not looking at acquisitions as aggressively as earlier in the year," said Driscoll.
Not to be overshadowed were Getty Realty's earnings. The company earned $5.4 million for its fiscal third quarter ending Sept. 30, compared to $13.4 million for the same period in 2010. However, revenues increased $6.1 million from 2010 to 2011 to $28.1 million.
"We had a pretty good quarter," Joshua Dicker, Getty Realty's vice president and general counsel, said during this morning's conference call.
Getty Realty owns and leases about 1,700 properties nationwide.