Fysh restaurant faces eviction, owes $229,000 in back rent, here's what the landlord wants

PORT ORANGE − The landlord of Volusia County's largest restaurant is suing the eatery's owner for failure to keep up with rent payments.

Fysh Bar & Grill owner Sid Sethi is accused of owing more than $229,000, according to the lawsuit filed March 12 in the Seventh Judicial Circuit Court in Volusia County by the property's landlord, Josif Atanasoski.

Atanasoski filed the lawsuit under the name Halifax River Partners LLC, the limited liability corporation that owns the property at 3633 S. Ridgewood Ave. in Port Orange.

Fysh continues to operate business as usual for now, said Sethi.

"I am invested in the community," the 29-year-old restaurateur told The Daytona Beach News-Journal. "This restaurant means the world to me and the staff relies on me. We have built something special and just because we are facing a roadblock doesn't mean I am going to give up on everyone who wants us to make it."

How long has Fysh been in business?

Sethi opened the standalone two-story restaurant in October 2022. Fysh's enormous size as well as its riverfront location − highly visible to motorists driving on the Dunlawton Bridge − has made it a local landmark.

The restaurant consists of 11,000 square feet of enclosed, air-conditioned space. Upstairs there's a 7,000-square-foot covered open-air bar.

Including its uncovered outdoor patios, the total size of the restaurant is just over 21,000 square feet, according to Volusia County property records.

That's nearly twice the size of the county's second-largest restaurant: the 11,700-square-foot Stonewood Grill at 2150 LPGA Blvd. in Daytona Beach. That eatery opened in 2010 as Vince Carter's Restaurant, which was named after and originally owned by the NBA superstar and his mother Michelle.

Carter, who grew up in Daytona Beach, and his mother sold their restaurant to Stonewood Holdings in January 2017 for $4.3 million.

Where is Fysh?

Fysh is a standalone restaurant that opened in October 2022 on a property that is part of the City's Riverwalk District.

The 10 acres north of the restaurant is where the city-owned Riverwalk Park and Riverside Pavilion (home to the Port Orange South Daytona Chamber of Commerce) are located. The 10 acres south of the restaurant is where Tennessee-based Bristol Development plans to begin construction next year of a mixed-use project that will add 450 multi-family residential units and 35,000 square feet of restaurant and retail space on the northwest corner of Ridgewood and Dunlawton avenues.

Halifax River Partners owns the roughly 10 acres in the middle of the Riverwalk district.

Who is the landlord?

Atanasoski is co-owner, along with his brother, George, of Microflex Inc., an Ormond Beach manufacturer of flexible metal products used in cars and trucks, whose plant is on U.S. 1, just two miles up the street from Destination Daytona.

Atanasoski's brother is not involved in Halifax River Partners.

Halifax River Partners, according to state incorporation records, was founded in 2005 by a group of local real estate investors. Atanasoski bought out the partners to become sole owner several years ago, said Sheriff Giundi, one of the original investors. Guindi is a residential and commercial Realtor with Realty Pros Assured.

Guindi praised Atanasoski as "a straight-up guy" and an honest businessman.

What does the lawsuit claim?

The lawsuit states that Atanasoski is seeking to take back possession of the commercial property from Sethi for failing to make full payments on his monthly rent beginning April 1, 2023.

According to the lawsuit, "Fysh continued to make partial and late payments through December 26, 2023. Fysh has failed to pay any rent since its partial rent payment made on December 26, 2023.

"As of March 1, 2024, the total amount of unpaid rent owed is $229,737.73, not inclusive of late fees, interest and attorneys' fees, which are owned to Plaintiff under the Lease."

Atanasoski, in his lawsuit, stated that he considered Sethi's failure to keep up with his rent payments as a breach of contract which invalidates the 15-year lease for the property.

Restaurant owner: 'I want to make it right'

Sethi told The News-Journal that he is asking Atanasoski for more time to allow him to pay back what he owes while continuing to operate the restaurant.

"I want to make this right," said Sethi. "I offered to make a payment last month."

Atanasoski responded by filing his lawsuit the next day, Sethi said.

Sethi said that action left him no choice but to use February's rent money to hire an attorney.

"I plan to present a repayment plan to the landlord," he told The News-Journal. "If not agreeable, I will have to file for a chapter (11) bankruptcy (protection) to restructure the debt that way."

Sethi acknowledged that he fell behind in making payments on his rent for Fysh, which he said was approximately $40,000 a month.

Sethi attributed his inability to keep up with rent payments to "poor management" at Fysh during its first eight months in business.

"I had to fire the entire (management) team and put a new team in place. We are now climbing back with much better service, food, etc.," he wrote in a text message. "It will take time, but I am ready to fight for my team to make things right. We will need the local support, though. That will be key."

Sethi said he is in talks to secure financing from a family member as well as possibly taking out a Small Business Administration loan.

Millions of dollars invested so far into Fysh

The cost to construct the Fysh restaurant is believed to be well over $10 million.

Sethi said he personally spent "$5 to $6 million" on building out the interior and providing the furnishings and equipment. He acknowledged that his investment was only "30% to 40%" of the total construction cost. Atanasoski footed the rest of the bill.

A national chain is interested in the property

Sethi said he was recently contacted by a company that operates several national restaurant chains. The third party, whom he declined to identify, has expressed interest in buying him out and working out a new lease agreement with Atanasoski, he said.

Sethi said he is not interested at this time in turning over his restaurant to a new operator.

"With a new (management) team in place, it's been aggressively increasing in sales again," he said of Fysh. "Locals are starting to come back. We are gaining a lot of loyalty. It will take time, but we are working our tails off with our new management. Everyone here cares and will do anything for this restaurant."

Atanososki told The News-Journal, "I can confirm that (another restaurant operator is) working with me to see if we can get things done."

Atanasoski also declined to reveal the name of the third party.

Atanososki wrote in a text message that he would be willing to work with Sethi to sell his restaurant to the new operator.

Fysh has a mixed track record with inspectors

The News-Journal regularly publishes the findings of restaurant health inspections in Volusia and Flagler counties. Fysh so far has been inspected three times.

The first time, during the period of April 23-May 6, 2023, Fysh passed inspection with zero violations.

It didn't fare so well the second time. On Sept. 8, 2023, it received a warning for 37 violations, including eight deemed high priority. The staff at Fysh immediately corrected the violations.

On Feb. 27 of this year, Fysh received another warning for 10 violations including one deemed high priority. The latter had to do with improper storage of a bottle of multi-surface cleaning fluid. The violations were also immediately corrected.

How many people does Fysh employ?

Sethi said his restaurant in Port Orange currently employs 75 to 100 people.

Does he own other restaurants?

In addition to Fysh in Port Orange, Sethi owns an Italian restaurant in Coral Springs called Tavolino Della Notte.

The Palm City resident previously also owned a Fysh restaurant in Stuart (originally called The Twisted Tuna Port Salerno), but that eatery closed at the end of last year.

What the mayor has to say about the situation

Port Orange Mayor Don Burnette has eaten at Fysh on several occasions. He said he hopes Sethi and Atanasoski can work things out to keep Fysh open.

"This is a beautiful location for people to enjoy dining on the river," said Burnette. "I've been there for lunch a couple of times and thought it was fine. The food was good, the service was good, and the atmosphere was great.

"Dinner was a bit more problematic," he acknowledged, explaining that he and his wife ate at Fysh a week ago. "I am not going to comment," when asked about their most recent experience.

"They've just got to become more consistent," Burnette said. "I don't doubt Sid's commitment. I know he's worked very hard to get there and that even good businesses can have bad days. Everybody wants them to succeed."

This article originally appeared on The Daytona Beach News-Journal: Landlord sues Port Orange's Fysh restaurant. Here's what it's about.