More than two dozen businesses want the city to pay for losses due to Rideau sinkhole

More than two dozen businesses want the city to pay for damages and loss of business they say is a direct result of the massive sinkhole that opened up on Rideau Street in June. 

The city has received 31 written notices from businesses and owners stating that they plan to file claims, the city's clerk and chief solicitor Rick O'Connor confirmed Wednesday. 

Santé restaurant is permanently closed, with a "for lease" sign hanging in the second-floor window near the corner of Rideau and Sussex Drive. Holtz Spa, operated by the same owner, had to move down the street because its water was contaminated due to the sinkhole, said an employee.

Zesty Market, WLKN, and Le Spot are reporting major hits to their sales due to city shutting down Rideau Street for six months to repair and reinforce the ground for light rail transit tunneling. 

"Eighty per cent of sales are gone," said Zesty Market owner Nava Vosough. "We have to pay from our pocket to pay the rent, the employees. That's hard."

"Somebody has to help us," she added. "This is not our fault. We shouldn't pay for this damage."

Vosough estimates she lost $15,000 when the sinkhole knocked out power at her store and she was forced to close for several days. Food had to be thrown out and specialists called in to check the store's machinery. But she's taken an even bigger hit since the road closed and there hasn't been much foot traffic, she said. 

'Sales are down 60 to 70 per cent'

Owners of WLKN, a new clothing store, WLKN, had to negotiate lower rent with their landlord just to "stay alive."

CEO and co-owner Pierre-Olivier Mercier estimates the store has lost $1.5 million in sales since opening in August. The entrance to the store is not visible to many passers-by due to construction.

"For sure it's a lot of money we lost in this," said Mercier. "Without traffic we're not able to make sales. People aren't able to find the new location." 

The owner of Le Spot, a streetwear and footwear store, mobilized businesses to demand reimbursement from the city. 

"Sales are down 60 to 70 percent," said Le Spot owner Mo Abdo. 

Abdo had to shut down his store for 13 days in June because he didn't have water after the sinkhole. Even worse, he said, was when his store did reopen, the street was barricaded — a major impediment to getting customers through his front door.

He worries the city may not pay him back.

"I don't think they're going to reimburse," said Abdo. "They told me it's not their fault. I have a letter from the city, they're not taking the blame."

Claims passed onto insurance

The city said in a memo released Dec. 22 that the sinkhole "was not precipitated by the failure of city infrastructure."

Rideau-Vanier Coun. Mathieu Fleury has read the full report, which the city is keeping secret.

"We have indicators of water pressure and we believe that our infrastructure, based on our data, was not the cause of the sinkhole," said Fleury. "So the sinkhole happened, then caused the collapse of our watermains."

The city itself is asking for $1.5 million from the insurance company related to its costs related to the sinkhole. It has also passed on all 31 of the businesses claims to Aaon, the insurance broker for the project. The Rideau Transit Group also incurred millions of dollars to repair the damage and is filing a claim. The deductible is $500,000 that the city and RTG will have to pay, reads a memo.

To date, no lawsuits or precise monetary claims have been filed against the City arising out sinkhole, says the city.

The city would not comment further on the matter "until all of these claims are resolved so as to not prejudice the City's position in relation to either its insurance claim or any potential future litigation that may arise from the sinkhole event."