Credit: CATHERINE McLAUGHLIN / Monitor
A simmering dispute between the owner of the Steeplegate Mall and one of its three remaining tenants, the Zoo Health Club, is slated for a jury trial this fall.
In a series of court filings, Onyx Partners argues that the gym has long been in violation of its lease. The gym’s owner argued Onyx is using a bad-faith argument to get his business out of the space to save money and effort on the redevelopment project. After a judge’s order last year temporarily blocking an eviction, the two parties unsuccessfully pursued mediation. Further disputes have surfaced since, and now the case is headed for trial.
The Zoo is a New Hampshire chain with just under ten gym locations across the southern half of the state. It’s been at the mall since 2019 and has allowed other businesses to sublet space inside – including a tattoo parlor, a firearms training academy, a tanning salon and a wrestling center.
Onyx bought the mall in late 2023 and has plans to demolish and redevelop it into multiple apartment complexes, a Costco and other shopping stores. The plans call for relocating the gym and tearing down almost all of the mall.
Onyx has been trying to evict the Zoo since early 2025, claiming that some of the sub-businesses within the club’s space aren’t allowed uses under the lease. Onyx has also said the gym stopped paying its full rent, breaking its lease twice over.
The Zoo, which sued to block the eviction in May of last year, argues that Onyx is trying to evict it as retaliation for demands it made related to relocating.
In late 2024, the gym pushed back on a plan to move before demolition began. The new space would be about a third of the size, and the rent would be higher, per the complaint. The Zoo argued that business losses from the move should be compensated at around $1.9 million. Onyx began trying to evict the gym about a month later.
Both the previous mall owner and Onyx had known about and agreed to the businesses within the gym, and the developer only tried to leverage them as grounds for eviction after the gym pushed back on moving, the Zoo argued.
The mall owner’s issues with the sub-letters are “nothing more than a pretext designed to allow Onyx to proceed with its redevelopment of the Steeplegate site,” the gym argued, adding that the disagreement is “transparently retaliatory.”
Onyx also argued that the Zoo had “grossly inflated” what the relocation would cost. And since the landlord believes the lease has been broken, Onyx maintains it is not required to relocate the gym at all.
After a hearing last August, the court temporarily blocked the eviction, siding largely with the Zoo.
“It appears the landlord is now attempting to terminate the lease because of its own
redevelopment goals,” wrote Judge John Kissinger in September of last year.
Notably, however, Kissinger didn’t uphold other claims by the Zoo. The gym argued that Onyx, outside of its on-paper push for eviction, was trying to constructively force it out by deliberately allowing the mall to fall into disrepair. It pointed to issues with the plumbing, heat, parking lot and safety of the area.
Onyx had rejected this portrayal, including details about how it had responded to issues with flooding and heat. Kissinger wrote at the time that there wasn’t sufficient proof of a constructive eviction.
The parties agreed in November to enter mediation, but by April, it had proved unsuccessful.
In May, Onyx came back to court seeking to expand its justification for the eviction, stating that the gym hadn’t been paying its full rent. The developer claims the gym was subtracting money spent on HVAC from its payments, which isn’t how the lease accounts for disputed compensation over maintenance costs.
A hearing on this new claim is scheduled for August, and a jury trial is scheduled for October.
This isn’t the first legal dispute between the hopeful redeveloper of the mall complex and the existing businesses in the area.
Unlike fellow tenant JCPenney, the Zoo isn’t suing to block the demolition entirely. It wants the court to state that it has not violated its lease, protect it from eviction and make Onyx pay the $1.9 million in relocation damages, as well as its legal fees. Onyx wants to move forward with what it views as a valid eviction.
Meanwhile, the lawsuit with JCPenney remains unsettled, according to court records, even as city officials said in April that the dispute had been resolved.
An online real estate listing that appeared last year, which advertised space in the existing mall, has since been updated. It now shows the proposed layout of the redevelopment: a large Costco centered on the lot, its partner gas station along Loudon Road. Several five-story apartment buildings would be built along with a Whole Foods where the Regal Cinemas used to be.
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