citybeat (2007-11)

After a ruinous fire, an unusual commercial duplex makes its way back

Local officials, developers await word on the fate of fire-ravaged properties

Wednesday, March 7

Surviving on Sutherland

For years, one quarter-mile stretch of Sutherland Avenue has something like a car-accessible version of an international bazaar, with fresh produce stores and several ethnic markets. Much of its commerce has supplied demand created by international students concentrated at UT grad-student housing complexes on Sutherland, but the strip is also adjacent to modest neighborhoods just north of Sutherland that have been attractive to Mexican immigrants.

The commercial area took a major hit last July 14 when one of the oldest businesses on the strip, and one of the newest, were badly damaged by fire caused by a leaky hose to a propane tank in La Ilusion's kitchen. The fast-spreading fire didn't hurt anybody, but could have doomed the two unique family-run businesses.

No strip mall in town packs more diversity into a few yards of frontage as this commercial duplex at 3601-3609 Sutherland. The Holy Land, a grocery specializing in Arabic and Middle Eastern foods, has been doing business there for years. La Ilusion was a recent addition. The Mexican general store had a variety of groceries, but specialized in cowboy boots displayed in the big window in front. In back was a full-service taqueria. Early last summer, it seemed to be emerging as a community gathering spot, with a sort of fresh Mexican deli, a small restaurant with table service and a TV tuned to Spanish-language channels. It seemed to be developing an age-diverse, mostly Latino clientele.

On July 14, a gas explosion in La Ilusion started a fire that heavily damaged both businesses. For half a year, the smoke-smudged storefronts appeared to be cleared of furniture and merchandise. As of this week, one is back in business, and the other is reoccupying its premises in anticipation of a reopening sometime soon.

The Holy Land reopened for business on Feb. 5 after almost seven months closed. "We're getting there," says a tired-sounding Walter Ajlouny, who runs the place with his wife, Denise. He claims the business is not just surviving, but expanding. Some of their improvements may involve expanding the global definition of Holy Land.

"We're bringing in more different merchandise from around the world," he says. "From Bosnia, from Croatia"--he mentions in particular ajvar, a roasted red pepper spread previously hard to find, along with pickled cabbage and other delicacies. He's also adding selections from India and Pakistan.

This strip once supported two Indian/Pakistani groceries, but since the closing of Neelam's a few years ago and the slow conversion of Red Onion from a Pakistani grocery to a pizza parlor, there's been less supply for the demand.   

Ajlouny won't share details of his losses or the extent of their insurance coverage. "We're still dealing with it," he says.

Likewise, Rosalva Casillas, young proprietor of La Ilusion, can't guess at the amount of their loss. "We lost everything," she says, almost speechless to describe it.

La Ilusion had been open for only a few months when the fire hit, and for several months the interior was cleared out, with no overt announcement of a reopening, and no obvious signs of life. Some former customers suspected La Ilusion was over.

And Cassillas is still waiting for word from the insurance company. It's not a big operation. "It's just my mom, my brother, my dad, it's all family here," she says. But she's grateful that her brother Salvador, who also owns a construction company on Clinton Highway and is the official owner of La Ilusion, can capitalize a new start. Soon after Holy Land reopened, furniture appeared in La Ilusion, too.

"We're trying to get this thing going," she says, sounding upbeat. "We're hoping for, like, in two more weeks." They still have a few more hurdles to cross, but passed their fire inspection earlier this week.

In Spanish La Ilusion means hope .

More Warehouse Woes

Think of the fate of the McClung Warehouse properties on Jackson Avenue, ravaged by fire on Feb. 7, in terms of a domino chain. And the first domino should fall late this week or early next, when a structural report on the remaining warehouses will reveal what's possible for the surviving properties, and what local authorities will expect from property owner Mark Saroff.

"Those reports will tell us a whole lot," says Alvin Nance, chief of Knoxville's Community Development Corporation (KCDC). "If the remaining structures have to be torn down, and something all new has to be done, we'll probably need to give Mr. Saroff some more time. If they don't have to come down, we're assuming he will go through with his last proposal."

Saroff has proposed a host of different redevelopment ideas, most of them attached to various outside partners, without following through on any of them since he purchased the buildings in the early and middle 1990s. More recently, he had faced threats from KCDC that the city might seek to acquire the properties via eminent domain, due to their blighted condition and his apparent lack of wherewithal to rectify even the visual blight, much less take steps toward an ambitious redevelopment.

Last year, he managed to remedy a portion of the visual-blight issues through an abortive partnership with local developer Kenn Davin. Davin had some of the most egregious problems fixed, including a giant hole in one of the building's walls, but ended up filing a lien on the properties for $60,000 when Saroff summarily backed out of their association.

With the advent of the Feb. 7 fire, for which local fire department investigators have not ruled out the possibility of arson, only the buildings at 517, 519, and 525 Jackson remain standing; 501, 505 and 509 Jackson were destroyed. Fire department officials finished their investigation only last week, and are awaiting results of lab tests to determine a possible cause.

The structural integrity of 517 and 519 will be of paramount importance now; Saroff's latest proposal to KCDC called for those structures to be converted into some type of combination retail/residential development. The building at 525 has been decrepit and roofless for years now, and was scheduled for eventual demolition regardless of the other buildings' fate.

"Until those reports are back, we don't know what we're going to be requesting," says Nance. Among other things, the reports will beg the question of who will pay for any necessary demolition.

In the meantime, former Saroff partner Davin reiterates that he would still like to obtain the mortgages to the buildings, foreclose on Saroff, and move forward with his own version of the commercial/residential redevelopment plan. That would appear to be more difficult now, however, as two of the three mortgage holders have indicated they will be satisfied so long as they are paid off by Saroff's insurance.

"It's hard to say what's going to happen," says Davin. "I lost most of my leverage when those buildings burned. It may end up that I have to walk away and count it as another lesson learned."


Wednesday, March 7

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Tuesday, March 13