It may be the end of the road for legendary Upper East Side hot dog purveyor Papaya King’s longtime presence near the corner of Third Avenue and East 86th Street. Upper East Site has learned that not only will the 90-year-old institution not be reopening across the street as announced nine months ago, but the franchisee is also being sued by their new landlord for $4.4 million.
Upper East Site was first to report back in April that Papaya King’s operator had secured a lease for a much larger space at 1535 Third Avenue, between East 86th and 87th Streets, after a years-long legal fight with developers over the original property, which is slated for demolition.
Days after revealing the short move, Upper East Site shared photos of the spacious new restaurant’s interior adorned with black and white photos of the original location at 179 East 86th Street, as well as the message ‘Papaya King has been here since 1932.”
Even the original counter, where countless frankfurters were served to hungry New Yorkers for decades, was relocated to the new space.
Things then fell silent for months. All summer, it appeared that progress was minimal, with little more than a neon Mike’s Hot Honey sign peeking through a window to remind passersby of Papaya King’s presence.
In mid-August, Upper East Site received an email from Sid Sohail, the Papaya King franchisee operating the Upper East Side location, asking to call him.
Again, things fell silent. Sohail stopped answering our more than a dozen calls, and at one point, after we left several messages, his voicemail was full.
Upper East Site has now learned that Sohail and the Papaya King franchise are now being sued by its landlord at 1535 Third Avenue, where the business never opened, accused of breach of contract in a lawsuit seeking $4.4 million.
According to the complaint filed in Manhattan Supreme Court, Papaya King violated the terms of its lease, signed last March, by not replacing its security deposit with a letter of credit, failing to maintain a $5 million insurance policy on the premises, and by not opening for business within six months of the lease signing.
As Upper East Site previously reported, the business was then served notice from its new landlord demanding it pay $39,000 for September’s rent and correct the noted infractions or vacate the premises by mid-October.
Court filings state that on November 1st, the building’s owner reclaimed the storefront, taking control of the unfinished restaurant. However, the same filing also states that Papaya King is trying to regain possession.
In an apparent attempt to prevent reentry, the doorway to 1535 Third Avenue is now boarded up and chained shut with a large blue Retail Space for Lease sign in the window. Newmark, the agency brokering the storefront, declined to comment on the vacancy.
According to the lawsuit, the building’s owner is owed $196,875 in back rent from March through July, which would have been waived had the restaurant opened on time. Another $157,500 is being sought for unpaid rent from September through November, plus $17,718 in late fees.
In total, the complaint states that Papaya King’s landlord is demanding a judgment of at least $372,000 in back rent plus more than $4 million dollars in damages, interest and attorneys’ fees.
The building owner also wants a declaration that Papaya King’s lease has been terminated and a permanent injunction blocking its owner or employees from entering the space.
Papaya King’s franchisee has not yet filed a response to the suit. When contacted by Upper East Site, Sid Sohail said the lawsuit had been settled without providing evidence, despite multiple requests.
Sohail added that Papaya King was now looking for another new space in the area. Multiple attempts to contact the landlord’s lawyer were unsuccessful.
UPDATE: A notice of discontinuance was filed in court by Papaya King’s landlord on January 10th, 2024, ending the lawsuit against the hot dog purveyor.
Additional reporting by Nora Wesson