Zocalo Still Squatting in Shake Shack's Space

Grand Central expansion stymied by angry occupant
Wikimedia/BeyondMyKen

Shake Shack's plans for a new outpost at Grand Central Terminal were announced a year ago, but the former tenant is refusing to budge.

According to Crain's, the current occupier of the space, Mexican restaurant Zocalo, received an eviction notice in February, but isn't giving up its ground without a fight. Owner Robert Shapiro even filed suit last month against Shake Shack and the MTA, asserting that "the bidding process [for retail space in Grand Central] is corrupted."

Zocalo has occupied the space since 1998. The MTA started accepting proposals on the space in January 2011. Zocalo put in a bid, but did not win. It was later announced that the Shake Shack was on its way.

Zocalo insists that Shake Shack is ineligible to occupy the space, as the request for bid proposals specified that a restaurant must have fewer than 10 units, and Shake Shack has 14.

Neither Zocalo nor Shake Shack commented on the lawsuit, but the MTA said a civil court had already ruled that Zocalo was occupying the space unlawfully.

"Zocalo is desperately pursuing any possible means to remain in possession of space it no longer has the legal right to occupy, contrary to the legal rights of the MTA and Shake Shack," an MTA spokesperson said.

Accordign to the spokesperson, Zocalo's annual minimum rent is $336,698. Shake Shack's 10-year lease on the same space starts at $435,000. By the tenth year, it will be paying $567,000 plus eight percent of sales over a certain threshold.