Latitude 360 Inc. abruptly closed its entertainment and dining venue on Jacksonville’s Southside on Wednesday, along with a similar venue in Indianapolis, to settle an eviction lawsuit filed by the properties’ owner.
However, the CEO of the Jacksonville-based company said Thursday it will continue operating the Latitude 360 concept with one venue in Pittsburgh, and he hopes the company will eventually be in position to start expanding again.
Chief Executive Officer Brent Brown said Latitude 360 reached an agreement at midnight Tuesday to settle the lawsuit filed in October by 30 West Pershing LLC, an affiliate of real estate investment company EPR Properties. EPR owns the properties in Jacksonville and Indianapolis.
As part of the settlement, Latitude 360 agreed to shut down the venues and turn the properties over to EPR.
“Obviously we didn’t want to do that,” said Brown.
“Yesterday was our five-year anniversary (of the Jacksonville venue). It’s a tough one,” he said.
Brown said ending the litigation allows the company to “take a step back, take a breather” and get its balance sheet in order.
“This was the best way to do that, rather than spend money on litigation,” he said.
The eviction lawsuit filed in Duval County Circuit Court said Latitude 360 owed $2.96 million in back rent on the two properties. Brown said the Jacksonville venue near The Avenues mall had been doing well.
“It really got caught up in growing pains on the Indianapolis side,” he said.
“Pittsburgh’s doing great,” Brown also said.
Still, Latitude 360, which went public in mid-2014, has been struggling financially, reporting a net loss of $12.9 million in the first half of 2014 despite an increase in sales.
Its stock has been trading near zero recently.
When the company went public, it had ambitious expansion plans and announced agreements to open venues in Albany, N.Y., Minneapolis and Southeastern Massachusetts, but those never came to fruition.
Brown said financing problems impeded the company’s growth.
“We could not afford a hiccup, which we had,” he said.
The hiccup happened when its primary lender went out of business — not because of Latitude 360 — and left the company scrambling for funds, he said.
“That left us in a $10 million hole,” said Brown. “It’s hard to dig yourself out.”
Although Latitude 360 is now only operating one venue in Pittsburgh, the company will remain headquartered in its Jacksonville office in Baymeadows, Brown said.
He said Latitude 360 had a loyal customer base in Jacksonville and he would like to find another location to reopen a venue in the future.
“If the opportunity would present itself, we would jump at it quicker than you can imagine,” he said.
With the lawsuit behind it, Brown thinks the company will be able to pay off its debts and raise new capital to grow again. He said there are many potential locations in other cities with landlords willing to work with the company.
“We feel like we can grow as fast as we’re capitalized,” he said.