A month after Caffe Kilim was forced to pony up a half-million dollars to keep its Daniel Street location, that deal has fallen through and another Portsmouth coffee shop is facing real estate problems.

Jim and Annie Clark, owners of The Den coffee shop located in Commercial Alley were served an eviction notice last week over unpaid rent. The couple also owns the Black Bear Micro Roastery in Center Tuftonboro.

“The whole dispute is over the lease,” said Jim Clark. The coffee shop is promised 600 square feet for $1,150 a month in rent, according to Clark. However, with the building under new ownership, the store now can only occupy 360 square feet. Because that was “60 percent of what we were supposed to get, we adjusted everything by 60 percent,” Clark said, paying $690 for rent in August and September. Shortly thereafter, Clark received an eviction notice from building owner Perry Silverstein, via Silverstein’s lawyer John McGee.

Also at issue is the store’s cellar. According to Clark, Silverstein is trying to limit The Den’s use of the building’s cellar, which is the store’s primary storage space. Without that space, “we’ll probably have to close down,” Clark said.

Clark has challenged the eviction and a hearing will be held Thursday, Sept. 22, at 9:30 a.m. at the Portsmouth District Court. The remaining $920 in rent is in a savings account, which Clark said he will pay if a judge orders him to do so. If evicted, Clark said it’s unlikely The Den will open a new location in Portsmouth because of high rents downtown and the fees associated with opening a new business.
“We just don’t have the money,” he said.

Caffe Kilim is struggling to stay ahead of the real estate curve as well.

During the last week of July, Kilim owners Yalcin Yazgan and his wife Janice Schenker found out that a downtown Portsmouth restaurant was interested in purchasing Kilim’s space. Under the terms of Kilim’s lease, Yazgan has right of first refusal, but had 10 days to match the prospective buyer’s offer. Yazgan said the shop planned to open a kitchen and serve Turkish food as a way to pay the almost $500,000 needed for the location. However, due to zoning regulations, the shop cannot install an exhaust fan that would be needed for the kitchen.

Yazgan was quick to caution that Kilim won’t be closing any time soon. The coffee shop’s lease doesn’t expire until October 2006, Yazgan said. A report in the Portsmouth Herald last week said Kilim had “found a new home” on 163 Islington St. That made it sound like Kilim was shutting the doors of its Daniel Street shop, according to Yazgan, which he says is not the case. The Islington Street location will be a second shop, he said, not Kilim’s new home.

“We’ve got 14 more months. A lot of things will happen,” he said.

Starbucks is also looking to open a second store in Portsmouth. Portsmouth Farms LLC, owner of the coffee giant’s Market Street storefront, appeared before the Zoning Board of Adjustment last week to secure a variance for a possible store to be located at 1855 Woodbury Ave.